How to Deal with 4 Categories of Problem Tenants, #3: The Professional

In this Problem Tenants series, we’ve already tackled tenants who are disgusting Slobs or demanding Hotel Guests. Now, let’s take a look at how to deal with another type of problem tenant: the “professionals.”

“Professional” tenants may have a respectable-sounding nickname, but really, all they do is rip off landlords.

These tenants hop from rental to rental, signing leases without ever planning to pay rent. They usually know the system better than most DIY landlords, have little tricks for avoiding legal action, and manage to live for free by manipulating naive landlords.

Sometimes, they don’t pay rent for three months, and only begin paying once you file an eviction against them. But even then, they don’t pay in full, and only when they absolutely need to. Landlords are forced to accept the partial payment, only to repeat the attempted eviction process all over again a few months down the road.

Professional tenants give landlords a run for their money (or rather, make them run for their money), play on their emotions, and waste precious time, but there are ways you can outsmart them to stay one step ahead, and it all starts with diligent tenant screening.

During screening, look out for these red flags

1. Fake identities (they might use their relatives’ or friends’ identity)

2. Suspicious, incomplete, missing, or even fake previous landlord references

3. Financial records with bankruptcies, judgments, or bad credit

4. Recent legal proceedings (including evictions that were filed without pushing through)

5. An extensive knowledge of landlord-tenant laws

6. Unexplainable gaps in their rental history

7. And a very convincing sob story (this is the most popular trick landlords fall for when dealing with professional tenants!)

8. They’re in a rush to move NOW, or offer to pay several months of rent upfront

Because professional tenants are pros at manipulating the rental process, make sure you verify everything that applicants submit. Check if their identity is real, if all their references are legitimate, call up their past landlords to interview them, and double-check all employment, bank, criminal, court, and credit reports for gaps or inconsistencies - this article will give you more tips on screening applicants thoroughly.

But what if you’ve already rented to someone with no intention of paying you? Don’t let it drag on and allow them to stay in your property, since that’s exactly what these pros are hoping you’ll do. If a professional tenant has slipped through your screening net, here’s how to deal with them:

- Make Sure they Sign the Lease - This may seem obvious, but some landlords have been taken in by professional tenants who never sent their completed and signed lease, meaning they have no legal obligation to pay you, at all. Never, ever hand over the keys until every necessary signature is in your possession, and always make the tenant sign lease documents first before adding your own signatures.

- Don’t Get Emotional - They might continue the sob story that they told you during the screening process, or whip up another Oscar-worthy tale of how someone in their family is sick and needs the money that they were initially going to use to pay rent. Whatever the story is, they will take advantage of your human nature just to delay the rent payment a bit. “Two weeks tops!” they say. “I just need to help out my dear old mother in the hospital,” they plead. Don’t cave to this kind of emotional blackmail, either during the screening process or after. You should always treat your rental like a business, and don’t let emotions cloud your judgement when making important decisions about your business.

- Beware of All-Cash Payments - Not only do professional tenants avoid paying in full, but they usually also like to pay in cash, because they prefer a method of payment that’s impossible to trace. They can lie about making payments and forge receipts, creating ambiguity about what actually took place when the both of you arrive in court. Always document every payment, including cash payments, and send records of all receipts to tenants, so they can’t claim a discrepancy later on.

- Document Property Condition - These nightmare tenants also like to find a small issue in a property and blow it out of proportion, claiming that the home is uninhabitable; therefore, they will withhold their rent payment until the issue is fixed. They might even trash your house on purpose just to create “proof” of its uninhabitable state. They’ll then bring this up during court hearings, forcing the judge to reschedule another hearing when there is proof of proper habitability. Keep updated and detailed records of your property condition prior to every tenancy and at every inspection - these will back you up in the event of a dispute.

You can only imagine the kind of problematic tenant we’ll discuss next (we’ve saved the worst for last). Keep an eye out for the final installment of our Problem Tenants series next week.

Any experience with Professional tenants? How did you deal with them?

Image Courtesy of Karolina Gabrowska