Lesson learned from an airbnb Squatter

[Rob Chiang]

Full disclosure: this long drawn out situation is over, but it is still worth sharing so other members can learn from my blunders. I rented out an SFR to a corporate leasing service (they rented out the rooms on their own terms, like airbnb). I had great success with this type of tenant for years. However, there was a new copycat startup in california. When my SFR came up for rent, I sent it to my familiar corporate rental tenant and the new one, for competing offers to rent.

The new one bid $500 higher in monthly rent.  Naturally, we went with the higher offer to rent.  Even though I didn't have firsthand experience with the new company, I was comfortable with the business model.  We signed a 1 year lease with them. Everything was great the first 6 months.  

Then...covid happened and travel shut down.  They claimed that their business was hit hard.

The company then said they were going to have trouble paying the rent, please waive the rent or reduce it for a couple of months.

Then they stopped paying.  2 months later we got instructions on their chapter 11 filing and we were to immediately assume the role of corporate airbnb style landlord.  Total rent accrued to be $20K due.

Out of 5 bedrooms in the house, 3 tenants were remaining.  2 agreed to leave peacefully.  This is where the story gets interesting.

One refused to leave and also refused to pay.  Can you guess what happened next?....

[Malkia Ra]

As I read this story, I can't help but think of how often bad tenants are "forgiven" as an incentive for them to willfully move from a property, only for them to apply for their next rental and get approved because there are no collections/judgements on their record warning future landlords of how horrible they are, and thus the cycle continues...