It is very stressful when you’ve done all you can do to live up to an agreement you made and the other person seems bent on not living up to the agreement and making your life miserable. If you are a landlord long enough, this is something that is bound to happen with regard to a tenant not complying with your lease.
This blog post will look into the top ways tenants don’t comply with the lease and give you a few ideas about what to do prior to eviction and when to pull the trigger on evicting.
The number one reason we evict tenants at Evernest is when they don’t pay the rent. I would say at least 80% of the evictions fall into this category. The reasons tenants don’t pay rent range from circumstantial reasons, all the way down to malicious reasons. When you are in the middle of someone not paying, it all feels malicious.
The most common circumstantial reason is if a tenant loses a job or has an unforeseen expense. Some examples of unforeseen expenses we’ve experienced are a death in the family, a car breaking down, and health expenses. There is also a category of “should have foreseen expenses” because some tenants don’t plan very well for certain seasons of the year where they spend more money. . . mainly Christmas and when kids go back to school. Either way, whether they plan on it or not, they don’t have the money to pay you on time and that becomes your problem.
There are also some malicious tenants that spend their life going around taking advantage of people. They typically prey on the new landlord and are well versed in how to live in a home for long periods of time rent-free through lies and an incredible knowledge of the landlord-tenant laws. But, they are usually in the small minority. This article will not cover how to handle them and will look more into how to handle the circumstantial issues.
While a distant 2nd place, this one is solidly in 2nd place for the most common reason to evict a tenant….and sometimes happens in conjunction with your tenant not paying rent.
This type of tenant comes in and within a month has already wreaked havoc on your home. After you have spent so much money on the home getting it ready, to walk in and see what these tenants have done to your home is sickening and (unless you are a saint) makes you want to physically hurt them – which we don’t condone.
Tenants selling or using drugs are also a reason to evict. One of the cool facts about the Uniform Alabama Landlord Tenant Act is that this “breach” of the lease is not curable. Meaning, that unlike renting or tearing up your house, these tenants can’t “fix” the problem and stay in the house. You are immediately allowed to evict them . . . period.
A violation of the occupants of the home is also a lease violation where it may make sense to evict a tenant. We’ve had this happen before where a person on the Sex Offender Registry rented a house through his girlfriend. When the notice went out to the neighbors about his new address we heard about it and immediately moved to evict.
As annoying as some neighbors can be, the last thing you want is for your tenant to be the annoying neighbor. Late night parties that consistently keep the neighborhood awake will make them and you the most hated people in the city.
Usually, you find out about this from the city or the HOA. The tenant refuses to get off their rear end and cut the yard on a Saturday or Sunday. This type of laziness usually also works its way into the interior of the home. What the yard looks like on the outside is what your home looks like on the inside. And we think it’s worth noting here that if you (the landlord) aren’t taking care of the house, prospective tenants perceive that you won’t take care of it when they’re living there either.
So you find yourself in the unenviable position of one of the above categories. Here is what we suggest doing about it . . .
Your first step is to communicate to the tenant that they are in violation of the agreement. If you want to work fast, you can put a 7-day notice on the door. We always like to assume they are trying to do the best they can do and that the violation may be an oversight. We like to communicate with them in writing first. For instance, if we receive a notice from an HOA about the yard, we may send a copy of the violation to the tenant via email and nicely remind them in the email that they need to do the whole neighborhood a favor and keep the yard looking good. I highly suggest that the communication come in writing. If you decide you want to give them a call, make sure the call is professional (remove the emotion) and follow up with an email or letter that outlines what you discussed and the resolution.
The first sign that things aren’t going to go well is that the Tenant is not communicating back to you. If you email, mail, or call and you aren’t getting any response this is a huge red flag. When the tenant communicates with you, they should provide you with the following:
This is typically where I see the most breakdown by the Landlord/Owner. Out of human nature, you give 2nd and 3rd chances. No 2nd chances. You have already allowed them a 2nd chance. They broke the lease, you gave them a way out. Now the way out has changed and you can’t give them another try.
Now you know you want them out and you need to do the best you can to avoid losing tons of money in the process – which eviction is a long and costly process. The best way we’ve found to do this is to give them a date they need to be out by and promise them something in return for being out by that date. This is typically hard to do after they’ve basically drug you through the mud, but promise me it is in your best interest for them to leave amicably. I’ve seen people promise to forgive all the back rent if they are gone, promise not to pursue them in collections, and even give them “cash for keys”. Whatever you decide, it will be cheaper than a 90-day eviction, plus attorney’s fees and courts costs.
Pulling the trigger on an eviction is really a sad day. Recognizing that this is the only way of getting the tenant out is a realization that you will have to come to if you are in this business long enough and rent enough houses. A few quick suggestions about evictions:
For more on evictions, I highly suggest this recent article written to walk you through the process.
This is the worst part of being a landlord and owning rental property. We do everything we can do on the front end to make certain this type of thing isn’t going to happen, but it does.
My last bit of advice is to remember that whether you own one house or 100 you are in business and you have to treat it like a business. The best thing to do is to remove the emotion from the situation (some tenants are great at inserting emotion) and do what is in the best interest for you financially. If you have a hard time doing that, you either need to hire a professional or aren’t cut out for owning rental property.
Spencer is the VP of Marketing at Evernest. He wakes up with Google and Facebook on his mind. Having bought and sold over 150 homes in Birmingham, Spencer gets a kick out of helping new and seasoned investors navigate the mistakes he made as an investor. Spencer is also passionate about his love for Michael Jordan and does his best to explain to the Millennials (who never saw him play live) how much better he was than LeBron. He loves to hang out with his wife, kids, and the world’s best black lab, Jett.