Apartment Trashed by Tenant

Sometimes, regardless of how responsive you are, you may have a tenant who is unwilling to recognize the logical and legal limitations of your role as landlord. What they decided to do about it is anyone’s guess; hopefully you leases to a decent and honest person. Did you? Did you conduct a background check to verify their employment, income, and or criminal history?

Sometime tenants will just trash your place. Like this guy in England from a Times UK article.

The landlord spents months trying to evict a tenant, and when he finally did, he found the place was vandalized to the tune of £20,000. That’s a big number to absorb when you are attempting to earn some passive income of your income property investments.

According to a survey by Allstate insurance, 60% of tenants nationwide do not have renter’s insurance.   The cost of renter insurance is very cheap, usually $15 to $20 per month, and within the price range for most tenants who are not absolutely destitute.  Some landlords are requiring their tenants to carry renter’s insurance because it protects the landlords cash flow.  Should a tenant sustain a devastating loss without renter’s insurance, they might not be able to pay the rent.  And then the landlord must begin the long and costly job of the eviction process.

Tenant’s Liability

According the OC Register, some tenants believe that they don’t need renter’s insurance because they are covered by the building owner’s policy.  While the building owner’s policy covers the building, it doesn’t cover theft or kitchen fires.  Tenants are arguably liable for “any problem they create” such as a kitchen fire.  Even if your landlord doesn’t require renters insurance, it’s valuable for tenants the protect their property and the risk of a lawsuit with renter’s insurance.   Renter’s insurance should defend you should someone decide to sue you for slipping and falling inside your apartment or on your balcony.  Another little known detail is that renter’s insurance might be able to provide assistance should you be involved in a civil suit, similar to the protection provided by a home owner’s policy.   Talk to your insurance broker about the exact details of each policy.  

Landlords Benefits of Renter’s Insurance

Landlords who require renter’s insurance enjoy the benefits of having tenants who are protected, should a tenant-caused accident occur in the apartment, and it also provides a level of tenant screening, by screening out some tenants who are so strapped that they can’t afford to pay an additional  $15-20 per month.  If your tenants cannot afford this small amount, chances are they might not be able to pay the rent very soon.

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tenant screeninghomeowner policy

Creative Management in Columbia, South Carolina has received some positive press for instituting a new tenant screening and eviction program at the Broad River Terrace apartment complex.   The building has 103 units and had a reputation for violence, criminal and gang activity.  The new owners instituted a strong tenant screening program after taking ownership in 2003, and crime decreased from 364 incidents in six months of 2003 to 25 incidents in a recent full calendar year.

The article says that the city council is pondering whether to mandate other apartment complexes to pay for security measures, such as security cameras, security guards and better lighting.  They are wondering if legally, these apartment complexes pose an unacceptable risk to public safety.  It should be interesting to see how this legal issue plays out, especially since some property managers can be held liable if the crime is foreseeable.   The new mandate seems a touch heavy-handed and big government (will they be instituted for every apartment complex, or only larger, crime ridden ones?)  Is it open to manipulation and graft?   It’s worth pointing out that it appears Creative Management instituted this additional security policy and tenant screening program based on their own business strategy and not by government mandate, and now they are enjoying a better reputation, probably charging higher rents, probably seeing higher property values (in the long run) and receiving positive press and developing a excellent business image.  Hopefully the other apartment building owners will see these benefits and institute similar policies without government intrusion.

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landlord rights

Chicago tenants who face eviction due to landlord foreclosure may receive some additional assistance from City Hall.  The plan is being put forth by the Chicao mayor Daley, which will provide up to three months of rent and moving expenses for tenants affected by the landlord foreclosure.  The new bill is also looking to expand the notice to 90 days notice for all tenants affecting before being evicted from foreclosed properties.  According to the Chicago Sun Times, some renters “get as little as five days’ notice.”

Keep them renting or abandon the building
This bill addresses a larger strategic issue for urban planners, whether to keep foreclosed buildings with renters inside to maintain the value of the property, or evict them and have an abandoned building on the block, open to vandalism and abuse.

Illinois tenant screening
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renter advice

With a slow real estate market, the inventory of rental homes has increased, many with first time landlords.  The amount of renters has increased as many new home owners cannot afford to pay their mortgages.   Sometimes owners will attempt to find tenants themselves or use a mortgage company.   Home owners are advised to screen their potential tenants closely, because in a difficult economy it can be hard to find tenants with responsible cash flow.  The montgomery advertiser has a piece about a broker with more rentals on his hands.

Harris agreed that getting qual­ified renters can be difficult. He said his firm screens its renters more closely than many mortgage companies.”We look at credit reports, do a background check and verify in­come,” he said. The company even checks with former landlords or mortgage companies about payment habits.

Some tenant screening you can do yourself, but conducting criminal background checks and credit reports requires a background screening firm like corragroup.com.   You have secure account with online access to criminal data and credit data.   This is a significant step towards protecting an investment in real estate if you are planning to rent out your first home.

background checks
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real estate

With real estate prices falling in most markets, some property owners are renting out their homes while they live in apartments. They are waiting for the property values to increase before they sell and move on.   

The housing market morass has created a new class of real estate investors: the accidental landlords. Some, like Mr. Vallance, have moved into new homes and can’t sell their old ones — at least for the prices they want — while others, like Dr. Siqueira, chose to invest in the changing market. Then there are those for whom renting has become a way to forestall impending foreclosure.

If you are a new unlikely landlord, be aware of the pitfalls of renting out your property too quickly to the wrong tenant.  Conduct a thorough background check of all prospective tenants, including tenant credit report, evictions report and a criminal records search.

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Channel 34 news in binghamton New YOrk has a great story about a super bad tenant that wil make your head shake and your wallet cringe.  There’s a stereotype in our culture about bad landlords but not one about problem tenants.  There could be after reading this.  According to the article, it’s common for tenants to trash apartments, and leave behind garbage once they have moved out.  But the landlord said that this super bad tenant:

It was feces all over the place. There was literally millions, not thousand, but millions of roaches. Where I had totally barfed because there’s so much stuff that was going on. Three days ago this sidewalk, from that pole to that tree, was lined with garbage – furniture saturated with urine and infested with roaches, and garbage as high as I am tall.” 

 The final price tag for the clean up was $10,000.  Apparently the tenant paid their rent on time and never called about any problems.  Maybe they should have.

Would a background check help? 
It’s worth wondering whether a tenant background check would have alerted the landlord to the potential problem with this tenant.  As stated in the article, the tenant paid their rent on time and didn’t cause a problem.  It’s possible this tenant would have decent credit and no criminal record.  This is why it’s worth it to check for possible previous evictions.  Evictions occur according to the local, state and federal laws applicable in the area, adn are usually along financial lines, but sometimes the tenant can be evicted for other reasons, such as trashing the apartment.  If this happened before, it good to check again. 

Another thing to consider is make sure someone is doing walkthrough on your building.  If you don’t have a full time maintenance personnel, make sure someone is aware of the problems in the building and communicate with your tenants from time to time to be aware of any problems.  The complaints about the smells would have been a first warning. 

tenant screening
problem tenants
background checks

Problem tenants who commit crimes may have a tough time holding onto their apartments if a new inititive is passed Millville, New Jersey. The City Commission is exploring a new program which will allow landlords to work with the police and speed up evictions for crimes that occurr on their property.

Under the program, police would provide background checks and recommendations on prospective tenants.

Hopefully this program will work to the benefit of the community. We are a little skeptical about the efficacy of the police running background checks giving recommendations on prospective tenants, not because they aren’t informed or effective, only that this is exactly the sort of labor intensive work that boggs down police departments and creates a huge backlog of background research for police officers and non-sworns to do.

To speed up your screening, we recommend you run county criminal records searches in all counties where your prospective tenant has resided. The searches take approximately 1 to 3 business days, depending on your area, and will provide you with a powerful history of your tenants criminal past.

Landlords who attended the meeting in Millsboro shared horror stories:

Ted LaMantia said he has multiple clients that owe him thousands of dollars, including one tenant who declared bankruptcy twice to avoid paying him $6,000 she owed.

Tenant Financial Responsibility
So your prospective tenant does not have a criminal history. Now what? Make sure they can pay you. Also run your tenant credit history and also check for previous evictions, and bankruptcies, liens and judgments. You should also verify their current ability to pay for verifying their employment, either through a pay stub or employment verification search.

Read the entire article here:

 background checks
new jersey landlords
eviction records

The bad economy is causing difficulties for landlords and tenants.  Landlords are having a hard time collecting rent and evictions are on the rise.  Tenants wages are not keeping up with the cost of living. Recently in Yonkers, tenants and landlords met with the Westchester County Rent Guidelines Committee ti discuss the issue.

Sounding much more dire than in past years, some landlords said they are essentially down to no profit and are having to sell their regulated buildings. One owner warned that it could get bad enough that owners might begin abandoning buildings like they did in the early 1990s.

If you’re just getting in the landlord business, it’s more important than ever to screen your potential tenants.  While you can always evict a problem tenant, it’s a costly experience and takes a long time.  Protect yourself from the start by thoroughly screening your tenants with tenant background check.  We recommend running a tenant credit report, which will show their current debt obligations, debt-to-income ratios, previous late payments, and any loans they have failed to pay back, or bankruptcy.  In these times it’s important to verify income, so ask for a paycheck stub.  Compare this information to the credit report; some people live outside their means and you may want to pick a tenant that is not heavily leveraged.

 It’s important to know the laws and statutes of your city, county, state and federal for your area.  Keep these in mind before you begin your journey as a landlord.  

 background checks
bad economy
landlords

Chicago Sun times discusses the pros and cons of renting out your old home while you wait for it to sell.  In this tough selling environment, renting your home can be a good source of income to cover the mortage.  However, becoming a landlord can be a time consuming task if you haven’t done it before.

Rental income can cover some or all of the mortgage payments, freeing you from having to dole out the entire amount each month. You might even make a profit if your monthly expense is low enough.

The problems arise from the human element of dealing with your tenants.  It’s best to learn the local laws regarding your rights and responsibilities.

Disputes with tenants over tenant rights and unpaid rent could require legal representation and legal fees. – State, local and federal statutes must be understood and followed, with failure to do so often resulting in fines.

Always establish and maintain lines of communication with your tenants, and make sure they understand the terms of the lease.  One of the best ways to protect yourself from problem tenants is to run background checks on them.   With a signed release, you can run your prospective tenant’s credit history, criminal history, and eviction records.  Most background checks for tenant screening are instant, but you can also conduct a more thorough review of county house records if you feel it is important.  The credit report will provide you with valuable information about your tenant’s financial responsibility.   

 
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