Cops outside a house.

In the landlord sewing circle, conversations have a way of moving toward bad tenants.

No matter where your properties are located or how high your rental rates are, you’re bound to come across some bad renters — it’s just part of the business. Bad tenants affect more than just your bottom-line, they can wear on your sanity as well. If you feel like you’re attracting more than your fair share of “slumtenants,” maybe you are. Before things get any worse, take an introspective look at your policies and evaluate your business model.

Where Are You Purchasing Properties?

If you own properties in rougher neighborhoods, expect more problems and repairs. Lower demographic areas have lower income levels, higher levels of illegal activity, and many residents have a criminal past. Many will not have the decency to respect you or your property.

How and Where Do You Advertise?

If you’re nailing hand-written flyers to telephone poles, you give the impression that you’re desperate and probably will take anyone just to fill the vacancy. But if you take the time to take hi-def photographs and/or professionally made virtual tour videos to post on your site, you will attract a different type of renter. By including the rental rates in your marketing material and your website, you will instantly narrow the number of potential applicants. By charging higher rates, you’ll weed out much of the riff-raff.

The Application Process Is Your First Impression

Was the potential tenant on time for appointments? If they showed up late without calling or just blew you off with no consideration for your time, they’re probably not going to have much respect to your property either. Were they courteous and neatly dressed? If their appearance is sloppy, imagine what the inside of your rental will look like. 

For starters, charge an appropriate application fee. If prospective renters can’t scrape together the fee, how are they going to come up with the rent? Also, it’s smart to present a lengthy application, people who aren’t serious won’t bother to take the time to fill it out. Was the application written legibly, fully completed, and signed? Texting is ruining people’s penmanship, so that’s not the perfect marker, but if vital information or sections are left blank, you have to ask yourself, “What are they hiding?” These are some early red flags, though it’s not foolproof, it does you give an idea of how they will act as tenants.  

Don’t Skimp On Lease Details 

Sure, you can go online and just print out a lease, but be careful with cookie-cutter contracts. You want to be confident that every one of your required terms is in the lease. You’re better off getting an attorney to draft one for you, the initial cost will more than pay for itself when problems arise, or you find yourself in court. Make sure all tenants are listed and sign the lease. Once presented with the contract, many tenants will try asking for amendments, resist the urge to negotiate the terms of YOUR LEASE. By doing so, potential tenants will feel like they found themselves a “pushover,” you’re setting yourself up for problems in the future. 

Get The Scoop From Past Landlords

Your application has a section for references for a reason, make sure you contact previous landlords. A little extra time now doing basic research will save you the trouble of having to deal with the aftermath of damages or missed rent payments. Be glad to get the bad news early and weed out any subpar tenants. Past behavior is a good indicator of how they will treat you and your property. 

Max Out The Deposit

For the same reason it’s smart to charge appropriate application fees and rents, get as much of a security deposit as the law allows. It will weed out bad tenants that may have trouble coming up with cash on the 1st of every month. 

Don’t Be Lenient With Your Policies

Bad tenants are like sharks, they can sense prey in the water. You have a business to run and bills to pay. It is vital to be firm and consistent with all of your policies. Being passive about tenant screening, rent collection, and other house rules only cause more problems throughout their tenancy.  

You can’t always spot a problem tenant. Someone is bound to sneak through eventually. But with due diligence and proper screening, you should be able to limit your liability. You want to stay on top of your rentals and arrange for periodic inspections so you won’t get surprised when they move out. Finally, don’t rush the process just to fill a vacancy, if there’s any doubt, then there’s no doubt.