Investing in a rental property and becoming a landlord always seems like a worthy cause. Who wouldn’t want to generate a passive income that sets them up for retirement or future investments?
However, most people don’t know managing tenants can sometimes become a cause of agony. Imagine a tenant destroying property by breaking stuff when they’re not happy about something. Tenants who host rowdy guests or parties who shatter windows, rip appliances apart and cause damage to the drainage or electrical systems. Other times, the tenants may also cause the damage unknowingly. Either way, the repairs may cost you a few thousand dollars. What do you do when you face such situations?
Fortunately, you have a few options you can use to settle the repairs and even get compensation. Today, we look at what to do if the tenant damages the property.
Identify How The Damage Was Caused
Firstly, you need to get to the root of the problem before you can move forward. Identifying how the tenant destroyed rental property will help you know the best course of action to take.
Basically, there are two ways tenants cause property damage:
- Intentional damage: Some tenants are just careless and don’t maintain your property as well as you’d want them to. This is the category of clients who host rowdy parties, punch holes into your walls, tear up carpets or cause any other damage within the premises on purpose.
- Accidental damage: Don’t always assume your tenants are careless. Sometimes the damage occurs unintentionally. Create a strong relationship between you and your tenants so that you can rest easy knowing that they can take care of your property. Also, enhance your communication to ensure that they always notify you in case of any property damage. It’s better to solve property damage in its budding stages before it can morph into a bigger issue.
However, you should keep in mind that damage considered as normal wear and tear should not be considered as a tenant destroying property. Wear and tear include things like carpet wearing out in high-traffic areas, faded paint, or worn-out hinges. Repair expenses for normal wear and tear should be the landlords’ responsibility.
You can ask yourself a few questions while assessing the type of property damage. Did the tenant notify you about the property damage? Did they take full responsibility? Have you had any similar issues in the past with the tenant?
An age-old method of avoiding disputes when you notice your tenant destroying property is by keeping written records of everything. It can increase your property management tasks but will come in handy in case of a disagreement.
While assessing the damage, you’ll probably have to get a professional property inspector or get into the property yourself. Take pictures of the damages to the rental property by the tenant. Go even further and take videos.
It’s important that you have pictures taken before the tenant moved in. This will be greatly instrumental as you can run a comparison to see the extent of the damage. Date all the pictures and videos since they can serve as important evidence should you sue the tenant in a court of law.
Don’t forget to document all the communication you have with your tenant in regards to the property damage. It’ll be better if you can communicate via email or written letters.
Estimate the Cost of Repairs
Next, you have to get the estimates for carrying out the repairs or hiring a professional cleaning service. This is important especially when the damage is extensive and you have to get a contractor instead of a handyman.
If you’ve outsourced property management to an agency, it’s likely to have a database of reliable vendors who are inexpensive and can do the work quickly. You can also get discounts if the contractor has a great relationship with the agency or depending on the volume of work needed and materials needed to finish the project.
If you’re getting the repairs done on your own, you ought to speak to several vendors to get various quotes. While you might want the best quote possible so that you can get the property back in the market quickly, ensure that the contractor is professional and won’t do substandard work.
Getting an estimate is important since it will help you charter a path on how soon you’ll get the property back in the market. If the amount of work needed is extensive, you can do the project in phases.
Discuss the Extent of the Damage With Your Tenant
At this point, you want to try solving the issue amicably. Remember a little kindness goes a long way in solving disputes. Go out of your way to seek a positive outcome. Talk to them about the severity of the situation and the consequences of a tenant destroying property.
Being reasonable with your tenant can also help you if you have to sue. If you were going to replace or renovate an item anyway, you may split the cost with your tenant.
Have it at the back of your mind that how this process goes will be determined by the kind of relationship you have with your tenant. If you don’t set clear boundaries from the beginning, your tenants will find ways to take advantage of you. For example, your tenants will think they can get away with anything if they’re always late on rent payment and you don’t enforce the lease terms.
Always plant your feet firmly on the ground and stand by the lease rules. This way, you’ll deal with fewer inconveniences in case of such disputes. Your tenants will also know that you’re not about to back down even if they delay and doing so may have consequences.
However, we understand that not all tenants are the same, as some may be problematic. Let’s look at how you can handle the issue with different types of tenants.
Solving With an Agreeable Tenant
Agreeable tenants are every landlord’s dream. You can solve the issue cordially if the tenant has admitted to causing damage by accident or they have a great rental history. If the tenant is not in a position to cover the repairs or their security deposit is not enough, you can come up with a favorable payment plan for them or come up with another solution.
Whichever way you agree to solve the problem, ensure you document everything. Even better if you include a contract that shows the payment plan or how the repairs will be handled.
Solving With an Aggressive Tenant
If you notice your tenant destroying property intentionally, you need to take action as fast as possible. Your first resolution should be to call the police. Assuming you’d documented every single step and communication with the tenant, the process will be easier. The police may arrest them or levy heavy fines which should see an end to further damage.
If the damages exceed an aggressive tenant’s security deposit, you can sue them in a small claims court for the damages.
If the tenant continues being problematic and causing further damages, it’s time for you to file for eviction. Filing for eviction should be your last resort since it can be a lengthy process. Be ready to continue documenting the process since the aggressive tenant may become spiteful and cause more intentional damage or become hostile towards you.
Solving With an Unresponsive Tenant
In some cases, you may have tried various means of communication but still no response from the tenant. Here, you may have to follow other means, such as using the security deposit.
If your homeowners’ or landlords’ insurance policy covers tenants’ damage, contact your insurance provider. You may also follow the extreme route where you hire an attorney to seek compensation from the tenant. This process will involve getting an investigator to locate your tenant, or obtaining a court order to garnish the tenant’s wages.
Deduct from Tenant’s Security Deposit
During the tenant screening process, you asked for a security deposit before the tenant moved into your property. The main purpose of the security deposit is to cover any damages caused during the occupancy period. It covers landlords against having to use their own money to pay for repairs caused by tenants.
As such, you can choose to use this amount for the repairs. In this case, you’ll have to notify your tenant that you won’t refund part or all of the security deposit via writing.
Ensure you provide the tenant with an itemized list of all the damages you found, the amount it costs to repair, and the documentation of the tenant destroying property, such as pictures and videos. This is important so that the tenant knows you’re being transparent and not taking advantage of them.
Keep in mind that you shouldn’t use the tenant’s security deposit for profit. Avoid overcharging the cost of repairs. Doing so may lead to problems if you have to go to court.
Check with your state’s laws in regards to the tenant’s security deposit.
Take Legal Action
As we mentioned earlier, taking legal action is the most extreme resort and may only be advisable as the last option. If the security deposit is not enough to pay for the damages or the tenant moved out long ago and is untraceable, you may consider taking legal action against them for compensation in a small claims court.
Before going this route, make sure you’ve documented everything and collected sufficient evidence of the tenant destroying property. Also, ensure you understand your local landlord-tenant laws because they will guide your suit.
The first step while taking legal action involves reporting to the police. However, note that they may not always arrest the tenant or place any criminal charges. It may only become a criminal case if the damage is extensive enough or some precious items were stolen or vandalized.
If the police won’t make any arrests, you can seek restitution for the damages via a civil court. This option can take some time so you’ll have to be prepared for the legal and attorney fees. Also, keep in mind that if the tenant was having issues paying rent, you might not recover much in the end.
You can also contact your insurance company who might ask for a police report. Your insurance policy might cover all or part of the damage.
Stay Objective and Level Headed
We understand that you don’t want anyone messing with your property investment. Having a tenant destroying property can be aggravating. However, getting emotional and making rash decisions can be costly for everyone in the long run. Don’t allow your emotions to cloud your thoughts or decisions when looking for solutions.
For one, if the tenant is still living in your property, don’t lock them out. You could end up paying for each day they spend outside the property. Remember you want to follow the proper procedures to seek an amicable solution that will be favorable for all parties involved.
As the landlord, you should be the bigger person. Be patient and take your time to carefully assess the situation from all angles. Your tenant will be more accommodating when you come across as reasonable and collected.
Rental property damage by tenants can throw a real estate investment off balance for a while. This is why you should know landlord rights when a tenant destroys property. You or your property management client are entitled to financial payment if the renter vandalized the house before leaving. You must document each and every process including every communication in detail. Take pictures and videos of the tenant destroying property and compare them with the pictures you took before the tenant moved in. These can be quite instrumental when gathering evidence when going to court.
Reach out to the tenant and look for ways to solve the dispute amicably. If they’re unresponsive, you may have to take legal action by calling the police, taking them to a court, or contacting your insurance. Most importantly, stay calm and don’t allow your emotions to cloud your judgment.
Are you a property manager looking to provide top services for your clients? Then we are glad to inform you that Mashvisor provides you with various tools to help you get insights into various investment opportunities on their behalf. For example, the Mashboard will help you find profitable investment opportunities that will help your client generate a great return on investment. Moreover, the Mashboard helps you carry out a comprehensive real estate investment analysis by looking at data and statistics then calculating the necessary numbers to find the potential return on investment. The tool is straightforward as you only have to click on a listing and access the Investment Property Calculator.
Start out your 7-day free trial with Mashvisor now.