How to Deal with Bad Tenants in Your Rental Property

Renting out a property should be an easy way to generate passive income. Unfortunately, though, troublesome tenants can quickly transform it into an ongoing battle over your own home. In such situations, you should try to negotiate but, if they’ve breached their contract, you may be able to evict them. If not, you can always sell the property to a third party and rid yourself of the nightmare.

Although tenants are entitled to certain rights, you don’t have to deal with their nonsense. In this guide, we’ll explain three effective ways to deal with bad tenants and help you find an out of this difficult situation.

Don’t forget—it’s still your property even if they’re contractually allowed to live there.

Sell to a Third Party

You can try selling the property to a third party and transferring your tenant’s lease to escape a situation where they are giving you serious problems. Although it is often difficult to sell a house with tenants, a fellow landlord is likely your best bet to work with. They understand what it’s like to deal with bad tenants. Ideally, they are ok with buying your rental property with tenants in the property. This is the easiest way to sell your rental property versus trying to list it on the market with a realtor.

Selling your rental property can seem daunting and expensive. If you can sell the property quickly, you can avoid holding costs that can add up each month while dealing with bad tenants. Additionally, you can avoid certain taxes when selling a rental property. Calculate what makes sense for you long-term as a landlord and property owner. If your vision is to ultimately continue owning rental properties for many years, selling might not be the best option.

Use the Legal System to Your Advantage

If you’d prefer to keep the house instead of selling it, you can always take things up with the legal system. In most cases, you’ll need to go through your state’s specific process for evicting a tenant. This usually starts with giving them a written notice that outlines the problem and what they need to do to fix it. For example, if they’re behind on rent, you might give them a week to catch up. If they don’t, you can start the eviction process.

Of course, the specifics will vary depending on your state’s laws. In some cases, you might be able to evict a tenant immediately if they’ve caused serious damage to the property or if they’re engaging in illegal activity. Over time, bad tenants can turn into squatters. Ejecting a squatter is no easy take for a landlord, regardless of their experience. Make sure to review the squatters’ rights in your area before pursuing this path. It’s always best to consult with a lawyer to see what your specific options are.

Negotiate Calmly Yet Clearly

Depending on your current relationship with the tenants, you can try to negotiate with them and make amends. Remember to remain calm and keep your communication clear. After all, an enraged landlord won’t get very far in trying to achieve a positive outcome. Start by drafting a formal letter that outlines the specific problem. For example, if they’re not paying rent on time, state how much they currently owe and when you expect it to be paid. If the issue is more general, such as noise complaints from the neighbors, try to be as specific as possible. It may help to include dates and times when the problem occurred.

Your goal is to come to a resolution that suits both parties. For example, if they’re behind on rent, perhaps you’re willing to give them more time to catch up if they agree to pay an extra late fee. If the problem is more serious, such as damage to the property, try to reach an agreement on how much they’ll pay to have it fixed. For existing damages that weren’t caused by the tenants, such as a damaged roof, consider adding those to the agreement when it makes sense to do so. Ideally, everyone ends on good terms and you can resolve the issue without having to go the legal route or sell your rental property.

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