We’ve all heard about the “tenant from hell.”
You know them – they know how to take advantage of the system. They know every law. They know how to take advantage of you and live totally for free.
Unfortunately, these are really common in the great Commonwealth of Massachusetts.
They can be so bad that you might just pay them to leave.
Unfortunately, tenant-friendly states like Massachusetts, just make it harder for us to run a good business.
Not only is it bad for us, but it makes it difficult for good tenants to find quality apartments!
So, it’s important to avoid the bad ones in the first place! It’s cheaper to avoid than to evict.
To do this, you need a good screening process. Believe it or not, most landlords have almost no screening process. Those that do have a process often are skipping important parts.
If you follow these steps, you’ll significantly reduce the number of bad tenants you get.
- Collect the Background Information
- Get contact information for previous 2 or 3 landlords
- Verify specifics about the Tenant’s job and income
- Have a written lease or tenancy agreement
- Follow the law and be a professional landlord
- Do not hesitate to deliver a Notice to Quit
- Require renters insurance
1. Collect the Background Information
This is the most important step. Without their information, there is nothing to check!
An applicant came to view the apartment of one of my friends. This applicant came straight from work and was wearing his kitchen clothes, stains, and even smelled like the kitchen he worked at.
He didn’t look super professional, but it’s a good sign when someone works! These aren’t luxury listings, so employment is the key determining factor.
After asking around town and calling the restaurant, it turned out he didn’t nor ever did work there! The entire thing was fabricated, including the outfit, smells, etc!
The point is, you need to collect their information so you can dig into them.
Get Social Security Numbers and an ID
How do you know this person is who they say they are? People with multiple evictions and unpaid bills will often use a friend, family, or coworker and apply under their name.
So, get an ID and make sure they are who they say they are before spending any money on credit checks.
Additionally, their SSN is required to do most of their credit/background checks and it will be very useful if you ever need to send their debts to a collection agency or court.
Do a Tenant Credit Check
You want to make sure they don’t have a ton of debt, or even worse, unpaid debt in collections. If they don’t pay their credit card, they probably won’t pay you.
You need to be a bit reasonable when considering a tenant’s credit. Often, tenant’s may have bad credit due to a divorce, lacking a credit history, or a number of explainable reasons. Focus on the report as a whole and not just the score.
Do a background check.
Most landlords don’t do this because it costs money. Being cheap and trying to save $25 is a way to cost you thousands. So just charge the fee to the applicant and get the background check.
In Massachusetts, background checks don’t really work after a certain date. In order to get a good background check, you have to use the CORI system which is available for landlords.
Also, search on Google for anything that may have happened but wouldn’t show up in a typical background check.
I also like to check out their Facebook or Twitter feed. You’ll learn a lot about them behind the curtains. I’ve seen people bragging about drugs, crime, etc. Obviously they don’t get accepted!
You don’t want to live next to a felon and neither do your other tenants. Check to make sure the application has a good background with no serious criminal behavior.
2. Contact Previous 2 or 3 Landlords
I don’t even call their current landlord. I’ve never got a bad reference from one, probably because they just want the bad tenant to move!
But, the previous landlord or two will love to dish all the dirt on them.
You also want to make sure their previous landlords are real people, that the address is real, and that the phone number goes to that landlord and not to their distant cousin who will lie to help them out.
Start by checkout out the Worcester Registry of Deeds to make sure the property exists and who owns it. If the name on their application doesn’t match, check to see if it was sold recently.
If the name still doesn’t match, it is possible that the owner has a property manager, and the tenants don’t know the owner. So you have to do more digging.
I personally have seen rental applicants invent addresses or give names and numbers to friends. I always check public records to see if the owner is the same as the name/number provided. If they list an apartment complex with an on-site manager, I search the leasing office number online instead of using the one provided.
Ask if they’ve ever been evicted or sued
If you want to be a great landlord, you need to always cover yourself. These days, it seems like everyone sues over the smallest thing. Especially with housing, make sure you reject applications for very specific reasons. The best way is to catch them lying to you on the application.
Most bad tenants don’t realize how easy it is to actually check their eviction history and court records especially since you have a copy of their ID, SSN, and previous addresses.
On multiple occasions, a prospective tenant has said “NO” when asked if they have ever been evicted just to find multiple evictions including one pending! Lying on an application immediately disqualifies an applicant and so does a recent eviction.
3. Verify Specifics About the Tenant’s Job and Income
Always verify income and never accept under-the-table income toward their numbers.
Any document can be forged. Research the company they work for and contact them directly to ask about employment.
Do not use the phone number listed in the application.
If a bad tenant would lie about their income, they will probably put a friend or family member’s number there to lie for them as well.
4. Have a Written Lease or Tenancy Agreement
Believe it or not, a lot of landlords don’t write things down.
A lot of problems can be resolved easily if the agreement is written instead of a verbal tenancy or lease agreement. This is especially important if you do end up in court.
The agreement is mutually beneficial as it lays out all requirements from both parties and reduces conflicts. But, since you write the lease, make sure it is full of language that protects you.
Make sure it’s legal.
Massachusetts has a lot of laws regarding your lease. Make sure you consult an attorney because having a bad lease can completely kill your chances of an eviction.
5. Follow the Law and be a Professional Landlord
It is very easy to get emotionally involved when your money is being wasted. It’s imperative that you know how to manage your relationship with a tenant – you are a business person and should always act like it.
The fact is that many bad tenants will goad you into doing something just to use it against you in court.
Avoid emotions. Don’t act on a whim. And make sure you follow all applicable laws.
6. Do not Hesitate to Deliver a Notice to Quit
A notice to quit is not an eviction (it may be called something else in other states). It simply tells a bad tenant to fix their mistake or they may be evicted. Explain to the tenant that it is just a formal step you must take and if they pay it will have no effect on them.
In Massachusetts, you can deliver a 14-day notice if it’s for non-payment. All other notices have to be 30-days, unless it’s for an emergency restraining order of some sort.
7. Require Renters Insurance
It’s important to have rules and policies in place. You should tell prospective tenants about some of them and judge their reaction.
A great example is requiring tenants to have renters insurance. Tenant’s that have no intention of paying you are very unlikely to want to protect their belongings with insurance.
Renters insurance will cover their belongings and protect you in the process. It costs less than $10 a month usually, so it’s a no-brainer for the tenant.
Avoiding Bad Tenants is Done in the Beginning
The only way to avoid a bad tenant applicant is to screen properly and reject them!
These steps simply won’t help you once you’ve already put a tenant in place. Once the bad tenant is living there, the only way to get them out is to evict them, which takes time and costs a lot of money.
Instead, take some extra time up-front to screen them, interview them and their contacts, and do all the investigation you can. An hour of time now is worth months of frustration!
What if I Already Have Bad Tenants?
If you already have bad tenants, you don’t have many options.
The first and most obvious choice is to evict the tenant or pay them to leave. Both options are expensive and can be time-consuming.
Your other option is to sell the property. Often, a property with problem tenants can’t sell easily on the open market or be financed, so you can reach out to a cash buyer like us who can buy it off-market, quickly, and deal with their problems.