Move Out Inspection with Drug Dealer?

General Landlording & Rental Properties
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Move Out Inspection with Drug Dealer?

Stephen E.
St Thomas, Ontario · Member since 2013 · 575 posts · 408 votes

I have a tenant who is moving out after having been busted with a large amount of drugs (approx $10,000) in the unit. I had started eviction proceedings against him but it seems he has moved out in advance of that taking effect. The building superintendents say he had a moving truck over there and had booked the elevator.  He contacted me to say that the unit would be cleaned and ready for hand back of keys this afternoon.

The question is, would you do a move out inspection with a drug dealer? I have not had trouble with him or his relative, although his relative was convicted of possession of illegal firearms.  I see two advantages in doing a move out inspection together: he would conclusively be returning possession to me in handing back keys, and we would note any damages together with him signing off on that. I believe that there may be some damage although I am not sure to what extent. Also I would likely get a forwarding address since our move out form calls for that.

The downside of course is who knows what might happen. Relations were good but that is before I filed eviction papers. As an alternative I could just have him hand keys to the building superintendent and then do a move out inspection on my own. I could get a forwarding address by performing another credit check, which my lease authorises me to do for enforcement of any lease term. Being sure that he has handed back possession is important as there are rules here about that and I want to change locks once he is out. if there is not sufficient clarity that he has returned possession then changing locks could be a breach of landlord and tenant laws here.

I am not sure what to do. I think that things would probably be OK but this is a somewhat open question. He had nothing against me prior to filing for eviction. We have had reasonably civil emails over the past few days. What do BPers think of the relative merits of meeting him to do a move out inspection or doing things remotely and inspecting on my own? This is a time sensitive matter - he could be out today.

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Garett H.
Member since 2011 · 41 posts · 11 votes
11y

He’s still just as human as you and I. You’ll be fine. 

You’ve probably dealt with larger drug dealers without knowing it. 

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  • William Hochstedler
    Broker · Logan, UT · Member since 2013 · 1k+ posts · 1k+ votes
    11y

    @Marcia Maynard 

    Perhaps I misspoke.  I meant that of all the tenants that cause PM's grief, most of them are inherited.  Those 25% of bad tenants that you mention constitute over 90% of your bad tenant pool as a whole.  In other words, of 500 tenants perhaps 20 were bad, 100 were inherited.  Of the 20 bad ones 18 were inherited and 2 we placed ourselves.  This is consistent with your experience, I think.

    I completely agree that professional letters on letterhead announcing a new property management company (or landlord) and pay-or-quit notices shape up tenants quickly who have been taking advantage of the self-managed, overly accommodating landlord.

    It's amazing to me how many landlords tolerate not getting paid.  We once took over a property where the tenant hadn't paid in 17 months!  Some work-trade thing that wasn't happening.

    Cheers

    0Reply
  • William Hochstedler
    Broker · Logan, UT · Member since 2013 · 1k+ posts · 1k+ votes
    11y

    @Adam Hershman & @James Wise 

    I heard somewhere that you can get an anonymous tax id to pay these taxes, so when you go to jail for selling drugs, at least you're cool with the IRS.

    @Stephen E. 

    Good stuff.  If you don't do it already, take your marketing pictures and a nice video when the place is ready.  That way you can market it next time before move-out.

    1Reply
  • Adam Hershman
    Las Vegas, NV · Member since 2015 · 237 posts · 107 votes
    11y

    Actually if you think about how many drug dealers have gone to jail on tax evasion and not drug charges it's pretty funny. Apparently its easier for the IRS to catch them not reporting than it is for law enforcement to catch them dealing.

    0Reply
  • Marcia Maynard
    Investor · Vancouver, WA · Member since 2013 · 3k+ posts · 4k+ votes
    11y

    @William Hochstedler I see your point. There certainly is a better chance of having a better experience (less drama, less grief, less cost) if you have an effective tenant screening process in place and are able to choose the tenant yourself.  Taking on a tenant who was chosen by someone else is riskier. We've had our share of bad apples that we picked too! We learn something every time.

    0Reply
  • James Wise
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes
    11y

    They got Al Copone on tax charges.

    0Reply
  • Stephen E.
    OP
    St Thomas, Ontario · Member since 2013 · 575 posts · 408 votes
    11y

    I thought I would post with an update. The unit has just been leased to a nice young couple who are about to have a baby. He is working his way through school with a job at a financial institution while he studies computer programming. She works at a fashion store in the mall. They make $52,000 and so handily qualify for $945 a month. The drug dealer is gone and the new tenants are a great blessing.

    We totted up the replacement cost of carpet with carpet replacement (we had put laminate in) plus complete repainting. It came out to $5,689, not including the damage to the door which was $800+ by the time the condo corporation had finished billing us. The adjudicator gave us an award for the door and our filing fee, which essentially means that we did not have to give any of the last month's rent back to our drug dealing tenant. The lawyers fees just came in and are $1,570. It has been an expensive exercise. We will not make any money on this particular property for years as a result of these expenses. My wife has got together the information for small claims. Although probability of repayment is low she wants to sue and hand it over to collections on the off chance that he needs to clean his credit up at some point.

    But the drug dealer is gone and we have an apartment that is better than it was before, with desirable young and upwardly mobile tenants. There is light at the end of the tunnel. Our other eight units are going just fine and the mortgages pay down a bit more at the start of every month. We have positive cash flow overall each month. While handling this renovation and related legal issues we managed to buy our ninth unit. It is a recently renovated townhouse and I have six showings booked for the first weekend after we take possession. The photographs really sell it. The renovated apartment took four or five showings before we found a tenant, but they are good tenants and will likely be there for a couple of years. They will tide us over and by that time we will get higher rents. It would have been much nicer not to have the bad luck of having a drug dealer for a tenant, but he was inherited and I am not sure what we would have done differently. His credit check was OK, not perfect but OK. In Canada it is not routine to run criminal background checks and there appears to be no ready means of conducting them. I will be much more wary of inherited tenants in future but I think the reality is that if you are going to be a landlord you are going to experience losses of some kind at some time. Investing in index funds has different risks and offers no payback for sound management. One of the things I like most about landlording is that if you work at it and are smart about it you can do much better than average. But this will come with some ups and downs. We have had a down, but we are on an upswing again. Thanks for all for the comments, I thought you would like to know how things turned out. We have great new tenants and we are glad.

    1Reply
  • Roy N.Pro Member
    Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
    11y

    @Stephen E. wrote:

    In Canada, criminal record checks are traditionally conducted by the local, provincial, or national (RCMP) police, but there are now some for-fee providers of this service.  The information is stored nationally by the RCMP, but all police forces are responsible for contributing - the system has recently been in the news for being months out of date.

    That aside, due to privacy law, not to mention your other rights, I cannot simply request a criminal record check on you.  You would request the check and authorise the results to be disclosed to me.  Even then, I am unlikely to get any significant details beyond number of charges / convictions, type/level of crime and dates (how long ago) ... basically a yes/no and, in the case of a yes ... oh, it was a misdemeanour twelve years ago.

    Furthermore, juvenile records are often sealed and will not be reported.

    0Reply
  • Stephen E.
    OP
    St Thomas, Ontario · Member since 2013 · 575 posts · 408 votes
    11y

    @Roy N. I was aware that people could themselves request a criminal records check if they were working in sensitive positions such as with children. But the landlords in the US seem to have routine access to systems that allow them to access criminal records directly. I would not feel comfortable asking tenant applicants to go to the police station and request a criminal record. It is invasive and could scare off applicants. I am pretty sure that the big landlords don't require this. 

    Do you routinely request criminal histories Roy?

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  • Roy N.Pro Member
    Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
    11y

    @Stephen E.

    Our privacy laws are a little more rigorous than south of the 49th ... at least for the moment.

    Only once have we request a criminal record check ... principally because we wanted the applicant to go away.   However, in our application process we reserve the right to request such a check.

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  • Stephen E.
    OP
    St Thomas, Ontario · Member since 2013 · 575 posts · 408 votes
    11y

    Good news and glad tidings: my new tenant moved got the keys today. We spent about $8,000 for all new laminate flooring, complete repainting, tiled backsplash and new counter tops, and complete retiling of the bathroom including walls and floor (with marble inlay, very nice).

    The new tenants are a nice young couple about to have a baby. They wanted to live in a nicer building as they are cocooning. Our unit fits the bill, it is in a stable and very well managed building. Everything is clean and the corridors are completely remodeled and look like they are in a hotel. Our lawyer's fee was $1,500 but the bottom line is the drug dealer is gone, we have a unit that is much nicer than it was before, and we have tenants who want to stay two years or more. This has been a challenge but with some time and money we have got over it.

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