Anyone who’s been a landlord for any length of item knows that headaches and hassles are simply part of the job description. And number-one among those headaches/hassles is problem tenants. For truly bad tenants in California, eviction is always an option. But that can be a lengthy and expensive process, so it’s better to find other ways to deal with bad tenants to solve the problems. Below, you’ll find 5 ways to deal with bad tenants in California in order to avoid having to have recourse to eviction.
1. Tenants Who Won’t Pay
A common category of bad tenants in California is those who just won’t pay their rent. And this, of course, will adversely affect your cash flow.
The thing to keep in mind, though, is that tenants don’t pay for a variety of reasons, and often they’re not being malicious or trying to stiff you. “Tenants.” industry experts say, “can withhold rent from landlords for a number of reasons, from cash flow shortages or temporary unemployment, to repair and maintenance disputes. Communication is critical when confronting this issue, and it’s important to understand the tenant and the nature of the issue and try to negotiate, if possible.”
As a landlord, you have a couple of options to solve this problem. The first and most effective is setting up a payment plan that makes paying more manageable for the tenants. You could, for example, when tenants are struggling financially . . .
- Implement “a policy of accepting a partial payment from a resident once per year”
- “[P]rorate the late fees and delinquent rent over the remainder of the tenant’s lease”
- Allow weekly partial payments instead of larger monthly payments
- Apply the security deposit to the delinquent rent payments
Another option is to change the tenants’ living arrangements. “If a tenant can no longer afford the rent, landlords can set them up with roommates or move them to smaller, lower-cost units.”
2. Tenants Having Problems With Other Tenants
And then there are those who are bad tenants in California because they are too loud or just obnoxious. Despite your best screening efforts, this kind of tenant can still slip through and can problems for you and other tenants.
The first step in dealing with this kind of problem tenant is to encourage and allow the tenants to resolve the problem themselves.“Make a clause in the lease that specifically states that all tenants are to make every able attempt to settle arguments without your intervention. Include a message stating that if you must get involved, one tenant might not be pleased with the resolution, and someone stands a good chance of leaving the property.”
But you may have to step in. In that case, mediation may be called for. Just be sure to “explain the consequences in a calm manner to aid in resolution. At some point, your residents hopefully understand that the net impact is on them, not you.” Also make “sure that any lease or rental agreement contains property regulations and rules, in addition to tight clauses regarding these disagreements.”
3. Tenants Who Pay Late
Some tenants do pay, but they always pay late – not withholding payment, but just late. In dealing with these bad tenants in California, it’s wise to keep in mind that the reason for late rent payments may be fairly innocent, something like mere forgetfulness.
You could meet with these tenants “to discuss their situation and why the rent is always late. You could also do things like waive late fees and other penalties if they promise to pay any late rent in full.” Another effective tactic is to send out payment reminders. Though it takes a little extra effort and time, it could be an easy fix for the problem.
4. Don’t Renew the Lease
When the methods outlined above for dealing with bad tenants in California don’t produce results, you still may not have to resort to eviction.
An option you have at this point is simply to refuse to renew the lease. Just be aware that this typically isn’t an immediate solution and that you need to “understand your local laws related to tenant protections before you do this. Usually, you can send your tenant a letter that informs them that their lease will not be renewed once it expires. You may need to give them 30, 60, or 90 days’ notice, depending on your state and local laws.”
5. Consider a “Cash for Keys” Agreement
Another last-resort solution, short of eviction, for dealing with bad tenants in California is the “cash for keys” agreement. It will cost you, but it will also get a bad tenant out of your hair and solve the problem. “A cash for keys agreement is a legally binding contract, whereby you pay a tenant a lump sum of money, and their lease is canceled, and they have to move out of your property.”
But, you may be wondering, why should you pay a bad tenant to move out? For the simple reason that it makes financial sense.
“It can easily cost $5,000 to evict a tenant and take months to do so. If you can just pay $1,000 and have a bad tenant move out within a week, you’ll be able to save a bunch of money – and start renting your property to a more qualified tenant right away.”
But Be Careful . . .
Whatever method you choose to deploy in dealing with bad tenants, make sure you’re aware of all the legal ramifications and implications. Tenant-protection laws are far broader than they were just a few years ago. Your best bet is to consult an experienced California investor to get help understanding exactly what you can and can’t do as a landlord. So for assistance dealing with bad tenants in California, contact us today at 7076715742.