5 Big Time Mistakes Landlords Make


“Trust, but verify” Ronald Reagan

That saying from Reagan is especially true when dealing with tenants.  They often need a dose of truth serum, right?  Here are the top 5 mistakes landlords make.  Learn to avoid these mistakes and you will be on your way to becoming a great landlord.

horrible tenants

1. Poor Tenant Screening

The costliest mistake is accepting a new tenant without properly screening. An undesirable tenant will often have a poor credit, rental and financial histories. Landlords should review previous landlord relations, credit reports, courthouse records and income. It is probable that if they have not met their obligations with previous landlords, then chances are that they will repeat their behavior with new landlords. Many landlords have faced horrific situations where tenants have stopped paying rent while employing legal maneuvering to avoid eviction. Others have faced tenants who moved in and initiated criminal activity, which adversely affected other tenants and neighbors. Either of these scenarios translates into expensive ordeals where the measures of rectifying the situation can threaten the financial stability of the landlord.

A thorough screening also involves verifying that the person who is applying is the same person that submits credit/criminal info for screening. A picture I.D. should be cross-referenced with the application. Landlords must make sure that there are no omissions, inaccuracies or inconsistency in the actual application. Due diligence will certainly save landlords much money and stress.

Screening your tenant should start when they first contact you.  Be prepared to screen out the really bad tenants on the phone and don’t let them waste your time.  Be up-front and tell them you verify income, check landlord references, pull credit and criminal background checks.  Letting them know that often screens out the really bad tenants without wasting more of your time.

The second screening is at the property.  Consider checking out their car, if it is a hot-mess inside that may reflect how your property will appear in 30 days.

Use a thorough application and be diligent in reviewing the details, verifying income via a pay stub.  Have a minimum income level established; I like to use 3x income vs. rent as a rule of thumb.  If your still not sure on your tenant, pay them a surprise visit at their current place.  That will show you exactly how your place will look in the near future and confirm if they will tear it up or keep it looking like a palace!

We always say… Be careful who you let in your house!  Screening is super important!

2. Lease 

Having a poorly prepared lease is very costly because it is the document that legally binds the landlord to the tenant. It is the rules of the relationship that dictate conflict resolution, financial responsibility and terms of execution. Without a professionally prepared lease the landlord stands to forfeit many of the rights afforded to the owners of the property. Landlords need to employ leases that are designed to protect them and their property and not the other way around. Many generic leases do not take into account the values of the landlord.  I highly recommend a strong Landlord lease to protect your interests and your rights.  Have it written with your desired outcome in mind!

3. Rent Collection

Collecting rent on-time each month, without hassle, is a very high priority for Landlords.  It is the rent collection that establishing regular, reliable cash flow for your investment!  Landlords must always enforce the terms of rent payment as it is written in the lease including late payments and fees. If not enforced, the landlord runs the risk of creating a dangerous precedent that will certainly cost the landlord dearly. Be sure to take action early in the month. Plan to issue a pay or quit on the 5th and unlawful detainer by the 10th.  No exceptions on this rule, every Tenant has the benefit of living in your place and the obligation to pay you rent on-time each month.

If a tenant has had a poor history of paying rent on time, a landlord should consider not renewing the lease. Being late consistently is a sign of financial trouble and future uncertainty for the landlord.  Avoid the hassles and establish easy collection methods with your tenants.  Allow them to pay-online and in different formats to make it easy for your tenants and easy for you as the Landlord.


4. Poor Response to Service Requests

The number one reason that tenants do not renew their leases is poor response and execution for service requests from the landlord. Tenants expect a constant inspection, repair, and preservation of the general conditions of their rental home. This also includes a timely repair or replacement of parts for appliances. Everything has to be in working order and problems must be addressed quickly and courteously. Everything has to be in working order and problems must be addressed quickly and courteously. To facilitate an efficient delivery of maintenance requests, the property manager’s best method of receiving these requests is easy communication with your tenants.  Consider using an online maintenance request system that documents the need for service.   It is important to maintain your assets and respond to the legitimate needs of your tenants.

Your goal is to find the best tenants available, treat them fair and respond to their legitimate needs so that they will continue to rent from you for many, many years.  If you refuse to maintain your property, you will find your best tenants moving out!

5.  Tenant relationship

You want the best tenants to maintain your property and continue to pay rent on-time for many, many years.  That reduces your vacancy and maintenance costs tremendously!  Being responsive to their needs is critical and establishing a relationship where tenants trust Landlords is very important.  If you say your going to do something, be sure to do it!  At the end of the lease your goal is to renew the lease on the best tenants.  Maybe send them a thank you card on their lease anniversary each year.  Maybe send them a small gift at the holidays or offer an upgrade in your home each year such as carpet cleaning or a room to be painted.   Establish a great relationship with your best tenants and you will protect your cash flow for many, many years!


How about you?

What have you found works great for screening, rent collection, service response and tenant relationships?

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