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JULY 2015 LANDLORD ADVOCATE

This Months Video Topic:

Lead Article:

How to avoid experiencing the recurring problem tenant.

Landlords expect to have problem tenants – it’s just an unavoidable situation that will always occur. The goal, however, is to eliminate the problem and keep the tenant, because long-term, lease-compliant tenants are not only typically good neighbors and members of the community, but also finding a way to keep them in place, is generally more profitable for the landlord. The challenge lies in how to avoid the situation of the recurring problem tenant.

The first thing to keep in mind is that not all problem tenants need to go. Tenants sometimes have an issue arise that causes them to fall into the problem tenant category on a temporary basis. For example:

  • They had a medical issue arise that produced unexpected bills, so they did not pay the rent in full for the first time in years.
  • A close friend moved and asked the tenant to keep their dog until they got re-settled in a few weeks, putting the “trying-to-be-helpful” tenant
    squarely in violation of the no pets clause.
In either situation, typically a letter or call from the property manager resolves the situation quickly and definitively.

However, some tenants fall repeatedly in the problem category, and no effort by the property manager will eliminate the issue. Such tenants historically pay the rent late, not because of a one-time event, but because they place all of their other wants and bills before ensuring that their rent is paid and their home secured for another month. This then drains time and energy from the property manager, who must monthly dedicate substantial time to dealing with all of the administrative and management issues that arise from such a non-paying tenant. So, what’s the best way to deal with the situation of a chronic problem tenant?

Just the tenant’s repetition of the problem behavior should be signal enough to turn to your landlord attorney – who, in turn, should resolve the matter definitively
and for an extended period of time, eliminating the need for you to continuously face the problem.

For example, with the tenant who is not paying the rent, the landlord attorney can bring a nonpayment of rent summary process case and get the tenant on a stipulated
judgment (enforceable through the court), under which the tenant either agrees to stay – and pay on-time and in-full each month – or leave the property if he/she cannot fix the problem satisfactorily. If the tenant refuses to enter a reasonable stipulated judgment, then the landlord attorney can take the case to trial and evict the tenant.

Sounds simple enough – however, we often watch attorneys in court who fail to deliver this critical level of advice and service to their clients. Typically they
either:<

  • Do not assist the landlord or property manager in entering the right kind of stipulated judgment,
  • Fail to make the judgment long enough, or
  • Fail to recognize and advise the client on the option of taking the case to trial should the settlement negotiations turn unfavorable for the landlord.

Having this inadequate level of representation in court can translate into a hard lesson for the landlord or property manager.

A past, parallel experience with my personal auto may help you better understand

Traditionally, I have turned to the dealership whenever my car needed service. However, I have had a repeated nagging suspicion that work was being done unnecessarily and repetitively. The last straw was a recurring rattling problem I had with the exhaust. Every time I complained about the problem, the service advisor explained that to correct the problem, they would need to replace the entire exhaust assembly. Life was busy, so I took him at this word (luckily not opting to have the work done), paid the bill, and moved on.

As the car aged and the issue arose for the fourth time in eight years, I really pressed the service advisor about the need to replace the entire section of the exhaust now at issue. We had gotten to know each other over the years, and — after looking around to see if his boss or co-workers were in earshot — acknowledged
that it appeared the car’s design was missing a key support for the exhaust pieces. The connection, not the functionality of the exhaust pipe was the problem. He suggested I take the car down the street to a local mechanic who could fix it definitively, and for a reasonable price. I took his advice and the exhaust literally did not rattle for the remainder of the car’s life.

We have seen this same phenomenon with landlord attorneys. They do not explain the various options available to their clients; rather, they deliver simplified,
predefined solutions that often cause the landlord to deal with the same problem tenant over and over. While this approach obviously benefits the attorney (through revenue brought in from each case), it burdens the landlord, not only financially, but through time invested in constantly dealing with the same problematic tenant.

Landlords should view this situation as unacceptable. If they have a problem tenant, they should turn to a landlord attorney who looks to resolve the problem the first time it is brought to them by the property manager. Getting to the right version of a stipulated judgment, including its length and specific terms — or resorting to a trial, when necessary — are the key moments of a landlord attorney’s service to the client.

Contact us if you find you have the same, recurring problem with a tenant — be it nonpayment of rent, lease violation, or nuisance behavior — and we will help you get to a definitive resolution.

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Quick Tip:

Convincing your tenant that renters insurance is a good thing.

As we face the oncoming hurricane season, it is well worth remembering that renters insurance is indeed a good thing. However, convincing the tenant of its virtue is often not so simple. Here are some suggested key talking points for landlords when the subject of insurance comes up with a tenant (or prospective tenant):

  • The landlord’s insurance does not cover the tenant’s personal property.
  • Renters Insurance is generally inexpensive – for most renters, it costs approximately $250.00 per year on average.
  • It typically not only covers the tenant’s personal property, but also includes liability coverage for the tenant, which would address tenant negligence that causes harm to other people or their property.
  • The tenant can expect to spend about 30 minutes with a reputable insurance agent to purchase a renters policy.
  • Replacement value coverage is preferable to “actual cash value” coverage, so you get your damaged property replaced with a new version of the same item and do not merely receive its cash value.

The thought is that insured tenants – those who understand the above points and have purchased a renters policy – are more likely to be better and happier tenants, if for no other reason than they will view themselves as self-sufficient when something goes wrong, and not always look to the landlord for redress.

Contact your landlord attorney if you have questions about renters insurance and whether you should change your lease to make its purchase by the tenant a requirement.

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DISCLAIMER:

The reading of this newsletter does not form an attorney-client relationship. The contents of this newsletter are for informational purposes only and do not constitute legal advice. Nothing in this newsletter is intended to imply or predict the outcome of any legal matter that you may be considering or be involved in. The Landlord Law Firm makes no warranties of any kind regarding the information contained in this newsletter.