Poor screening, how can I solve?

29 Replies

Hello, 

***I want to acknowledge ahead of time that I did not screen well enough and that I made a HUGE mistake in my tenant selection***

I finished my FIRST EVER rehab in a pretty solid Milwaukee area probably B-/C+, and had people knocking at the door left and right to rent, I was super excited to have all of this traffic!  I would send people to my website that I was using for screening, most just kind of looked at me like I had two heads. The website was a nice way to weed out those who were not truly interested in renting. Along came a woman who was willing to fill it out the online application, and was upfront with me that she had had a previous eviction. She gave me a great story about how the landlord had previously screwed her over (she was living with busted pipes). She worked as a registered nurse, which I thought was a pretty stable career, she was upfront about her eviction, and she filled out the online application. She had mentioned a boyfriend potentially living with her, she was aware that if he lived there more than two weeks he would be added to the lease and the rent would increase. We knew upfront that we were taking a risk, so they (boyfriend put half, she put the other half) put down a double security deposit. I was thinking that the worse thing would be no payment and if I had double security that I could keep then it would be okay, turns out this risk was a bad idea. 

So, let's fast forward a couple of weeks, the day before move in, she walks the boyfriend through who is in a wheelchair, and he loves it because of the open concept provided. We are working through the details of the lease, and he signs onto the lease as well. I was not to worried because I had gotten a positive vibe from him, that he was a good guy, but in all honesty I had started to get a bad feeling about her. I should have trusted my gut, and not signed the lease. They paid the first month rent a couple days ahead of time, so as far as know and am concerned things are great! We are having a couple of final things done to the property a couple of days later. When we arrive we hear from the gentleman living next door( who happens to be the neighborhood watchman) about a brawl that had happened the night before, along with reports of shots being fired. Long story short, the next morning there was a brick through one of the windows, and multiple police calls from the night before. The boyfriend had ended up in the hospital a couple of weeks ago with bedsores ( we actually collected the rent from the hospital because at this point she didn't have a phone). I later find out that they had broken up, and the brawl was between his sisters and her friends, and that per reports, his friends came back with golf clubs and firearms. 

Obviously, these two are no longer able to live together. They both wanted the other one off of the lease, which I was willing to do if one of them could get the other one to sign off on the termination. He eventually agreed, saying that he didn't have the energy to deal with her drama anymore. His request was that he get his security deposit back and one month rent. So, where we currently stand is that we are more than likely going to give back his half of the security deposit, and half of the first months rent ( I would be eating the cost in attempt to make a smooth transition). For her, due next month I said that she would need to come up with the other half of the security deposit along with the next months rent. She obviously is not to happy about that, but she wants to stay in the property, which in all honesty I would rather have her get the heck out of the property! 

Yes, I know that I have made many mistakes through this whole process, I would really appreciate anyones advice as to how they would have handled this situation or what they would do next. My question is; 1) Is there grounds for eviction, I believe there is, but I am wondering if it would be better to re-write the lease for the remaining 5 months and try to collect the rest of the rent from her, or pay her to move out. 2) Could we re-write the lease for a Month to month lease and just give her a 30-day notice, to avoid the eviction process, but still get her out of there in a timely manner. 

Thank you Any/everyone for your input! 

@Tyler Mutch ,

Sounds like a mess, but if the BF moved out, things should calm down.    If she has paid, then I don't think you have grounds for eviction.  

 I would tell her that since it's just her on the lease now, you'll need her to sign a new lease, and also that because the first month has been  so eventful, it'd be best for both parties to be on a M2M.    I'm not a lawyer, but as long as you have a clear statement that says the new lease overrides and the prior lease is null/void, the new one should be in force.    Just let her know that as long as everything is good, she can stay as long as she likes, but this offers flexibility if she needs to move.   I always pose this statement as beneficial to them,  "perhaps you get a promotion to a job in another city."   

I will say, if you really think the root problem is her, I'd offer cash for keys and get her out quickly.   Problems and people don't change unless they have to change.. although it sounds like her problem is drama, which isn't something that IMO can be fixed/adjusted.

I've had an instance where one tenant needed to move out. The other two were willing to stay on, and I simply signed a new lease with the remaining tenants for the remainder of the original term. It worked out pretty well. At this point, if she can pay and stay on for the next 5 months, you have the option to rent to a new tenant in a busier time early spring 2018.

@Tyler Mutch Sorry to hear about your luck. Keep plugging along, you will do just fine. We learn from our mistakes. I do not have experience with tenants so cannot help you there. Hope things with the tenant work out sooner than later. 

Do you have anything in your lease about criminal activity? I am a LEO in Il and I deal with those types of calls all the time. A lot of the rentals in the town I work in have criminal activity reports that we have to fill out and send to their property managers. In their leases it states reasons for lease termination due to police arrests or calls for service.

Hi @Tyler Mutch . I'm going to approach the question of poor screening.

9 times out of 10, if someone stops you and gives you too much of their time to tell you a crazy story, it's normally a good indicator of someone who mismanages their life. I have never had that situation work out to my benefit. 

The economy is humming, people have money, jobs and stability. There is no reason why you should need to take on someone who has an eviction or such significant issues. The things I ask for:

1. Credit report and score- I want both

2. 2 months of bank activity- I want to see that someone knows how to manage their finances. I always tell people, "I don't care if strippers are your thing, I just want to see that you know how to not go below zero".

3. 2 months of pay stubs- I've had someone tell method they were on salary. Based on looking at their pay stubs, they clearly weren't on salary. It also gives you the opportunity to get a more clear financial picture.

4. Contact for current employer- I want to confirm that the potential tenant is employed and that their employer has no expectation of that changing any time soon.

5. Contact for current landlord- Hopefully this reason is obvious

All this being said, I then use some special indicators of my own.

1. Do they attend the showing on time or early? Anyone who doesn't show up on time clearly doesn't respect or value your time. In the same breath you might also add that it's a good indicator of valuing that rent needs to be in your account when you agreed to it in the lease. I will forgive tardiness if someone tells me ahead of time such that I'm not sitting around and just waiting.

2. Turning in information- I have had some people give me exceptional flack for some of these items that I request despite the fact that I don't ask for their SSN or a number of other things. I had some girl freak out over showing me her bank activity. She felt it was an invasion of privacy. I told her "no problem, that just means that you aren't renting from me". I also expect the information that I've asked for to be delivered in a timely manner. This shows me that the tenant is serious about moving in.

3. Hold your ground- As you're learning, you are better off not needing to deal with a pain in the butt tenant rather than avoiding them in the first place. If someone isn't ok with x,y,z issues in your application, they are more than likely not going to work with you to solve a common goal. I tell all my tenants, "this is a business relationship. I understand that this is your home and I want to make you happy and comfortable. In exchange though, I expect you to pay your rent on time and to treat my property with respect. I pride myself on being exceedingly responsive and solving problems and look forward to having a great working relationship with you moving forward". I think it sets the right tone of I'm here to help, but don't cross me. I also find that tenants are respectful of my time and this allows me to obtain more units and achieve the economies of scale effectively. 

This was a long one, but hopefully this helps!!! It takes practice, but you'll get it.

"So, let's fast forward a couple of weeks"

What did you do with the application in those two weeks?

When was her eviction?

Was the previous landlord contacted?

Income verified?

Info on boyfriend obtained?

I can keep going but:

I'd have to see the application and supporting documents you gathered from that application to be able to have any understanding of what went wrong.

@Sam C.  This was part of the issue, I was too eager to get them in so I neglected the due diligence. I agree. 

The couple of weeks were them living in the property problem free! 

@Kristina Heimstaedt

Thank you for this, I had been using a website and not checking any of the information myself, another lesson learned. I rushed into getting it rented, I believe that if we are to void the previous lease and ask for all of this information at this point, she will throw a fit because we already sent her through one screening process. 

@Russ Fry Not explicitly other than what is included standard about criminal activity on the property, and because part of the brawl ended in the brick in the window I would assume it was on the property. 

@Michael Salamonski I think that is a good idea if we cannot come to an early resolution, I think that would work well for both parties! 

@Linda D. We are getting in touch with a lawyer later on in the week to figure out the logistics of signing a new lease, if need be. Otherwise I would agree that, personally, my favorite option would be to pay a cash for keys deal. How much is usually reasonable to get someone out ? If she can't leave peacefully, then we will move forward with the eviction! 

Thanks, 

@Tyler Mutch I'm wondering if it's your screening that's bad or did you buy in a war zone?? In either case you need to find a good PM and learn how to manage tenants from them. RR

@Ralph R. I did that bad of a job of screening, the neighborhood is really good, my property is one of the few rentals in the area, I would say 85% of the people are owners, with kids. 

@Tyler Mutch ic I was wondering when u said bricks and firearms. Get a PM for a while and try to learn some management from them.   Unless your really close on your numbers that's a good way to learn. Cheaper than bad tenants ever thought of being. RR

Sorry to hear of the troubles. Definitely a learning curve on this one. I can't stress enough the importance of a good property manager. My own 2 cents... Spending time finding more deals, analyzing, networking and marketing will make you more money than any savings you can realize in property managing yourself. 

It all comes down to your screening process. Build in expectations and provide clear written directions. Make applicants jump through a few simple hoops. You’d be surprised at how adding that little feature weeds out so many people. 10 years, zero evictions. It works!

I think Linda D gave the best answer. But what are you still thinking. In 30 years I have only done one cash for keys.

You are saying pay money to one tenant to move. Giving rent and deposit back to co tenant. Hopefully you are not pay their brothers friends cousin also. This all sounds crazy. You are in a business to collect money. Not look for every excuse to pay it back. 

First is the co tenant garnish-able.  If so no way he would get of my lease unless he was paying me.

You want to do this and pay him.  Why have a lease if you cant stick with it.

If things go south I want as many people as I can get to garnish.

But remember. This has happened to the best. It is how you learn. Just learn as cheap as disposable. And the same problems could have happened even when you properly screened.  And hope I was not to hard on you. We all had to learn at one time.

And the one advantage you have is Nurses make good money so you have an excellent chance of collecting. 

Tell the co-tenant if he wants any money  now, to get it from the other tenant.

Tell them no one gets off the lease unless both agree to terminate the current lease.  And then you can sign a MTM lease with whoever stays.

If neither agrees, then per the current lease both will be legally responsible for all future rents. This alone should be enough to get the co tenant to sign off.

The main tenant should do it because she will not want the co tenant to have any rights to the home. And mention it is MTM since you have more risk with one less cosigner.

Make this happen and wait a month. She is a nurse and needs a place to live. So it could still work out if the problem is gone and you want to wait & see for awhile.

Also my lease states tenants pay for glass breakage no matter how it happened. Make sure you send a bill and demand they pay it with next months rent.

The part I dont get is you say you had a lot if interest. So why did you take someone with an eviction on the record and the unknown of the boy friend? Couldnt you get a better applicant? Forcing people in a C rental to a website is not screening. It is reducing your pool of renters. And in general C rentals are best left to a competent PM, not for self managing. 

i agree with Account Closed use this opportunity to get them both off the lease.  "Sure he can be removed, but then we need a new lease and it will either be month to month or a much shorter lease.  That way if the problems continue you have a better chance of getting by unscathed.

@Tyler Mutch ,

If I were you,  I wouldn't see a lawyer, why eat another $200-$500 expense when you'll be paying her with cash for keys too?  I'd  go talk with the tenant, and state that due to all the recent activity, unfortunately you don't think it will be a good fit.    Her biggest thing will likely be getting the security deposit back to move to a new place, so talk with her about being able to do a quick inspection.   If she is reasonable, you can work with that.. but until you talk with her, she you don't know.   With her having the eviction, she might know all the laws and it be horrible.. but she might understand, and be willing to move.    

Originally posted by @Kristina Heimstaedt :

Hi @Tyler Mutch . I'm going to approach the question of poor screening.

9 times out of 10, if someone stops you and gives you too much of their time to tell you a crazy story, it's normally a good indicator of someone who mismanages their life. I have never had that situation work out to my benefit. 

The economy is humming, people have money, jobs and stability. There is no reason why you should need to take on someone who has an eviction or such significant issues. The things I ask for:

1. Credit report and score- I want both

2. 2 months of bank activity- I want to see that someone knows how to manage their finances. I always tell people, "I don't care if strippers are your thing, I just want to see that you know how to not go below zero".

3. 2 months of pay stubs- I've had someone tell method they were on salary. Based on looking at their pay stubs, they clearly weren't on salary. It also gives you the opportunity to get a more clear financial picture.

4. Contact for current employer- I want to confirm that the potential tenant is employed and that their employer has no expectation of that changing any time soon.

5. Contact for current landlord- Hopefully this reason is obvious

All this being said, I then use some special indicators of my own.

1. Do they attend the showing on time or early? Anyone who doesn't show up on time clearly doesn't respect or value your time. In the same breath you might also add that it's a good indicator of valuing that rent needs to be in your account when you agreed to it in the lease. I will forgive tardiness if someone tells me ahead of time such that I'm not sitting around and just waiting.

2. Turning in information- I have had some people give me exceptional flack for some of these items that I request despite the fact that I don't ask for their SSN or a number of other things. I had some girl freak out over showing me her bank activity. She felt it was an invasion of privacy. I told her "no problem, that just means that you aren't renting from me". I also expect the information that I've asked for to be delivered in a timely manner. This shows me that the tenant is serious about moving in.

3. Hold your ground- As you're learning, you are better off not needing to deal with a pain in the butt tenant rather than avoiding them in the first place. If someone isn't ok with x,y,z issues in your application, they are more than likely not going to work with you to solve a common goal. I tell all my tenants, "this is a business relationship. I understand that this is your home and I want to make you happy and comfortable. In exchange though, I expect you to pay your rent on time and to treat my property with respect. I pride myself on being exceedingly responsive and solving problems and look forward to having a great working relationship with you moving forward". I think it sets the right tone of I'm here to help, but don't cross me. I also find that tenants are respectful of my time and this allows me to obtain more units and achieve the economies of scale effectively. 

This was a long one, but hopefully this helps!!! It takes practice, but you'll get it.

This. My favorite are the deadbeats who are renting with room mates, make 12K a year, and have a 500 credit score then when I decline to show the house the slurs, insults and bad attitude show up. Even had one guy with a bankruptcy who I gave a chance to. Fifteen minutes into the appointment I had to call him. I just woke him up, sounded like he was smashed. He yelled and cursed on the phone and via a dozen texts after I hung up on him.

The girl who showed up almost 2 hours late to a lease signing (it was obvious she forgot because she was partying) ended up being NOTHING but problems.

@Tyler Mutch , you've received some really great answers, especially from @Kristina Heimstaedt . What I haven't seen anyone address (and maybe I misread what you are saying) is that you now only have a half security deposit and a half month's rent?

Both tenants put down a security deposit. Did they both put down the full amount or did they both put down half? I would not have returned ANY security deposit if you had only the full amount. If he's leaving and together they paid a double deposit, I'd take the cost of replacing the window out of the deposit, return what's left to him and tell them to take it up with each other. You do NOT want to get in the middle of a fight like this. You're not a counselor.

I'm not sure why you are returning any of the first month's rent. YOU didn't cause these problems. I would not eat anything in an attempt to make a smooth transition with a tenant you don't even want in the first place.

Take @Linda D. 's advice and go month to month. This woman sounds like she's going to make you wish you never rented to her. Drama is a disease you cannot cure.

Good news. I think you learned a good lesson (we all do, in different ways). Tenants teach us.

With shots fired and weapons brandished, you definitely got one end of the spectrum (the bad end). It may never be worse in my opinion (can't get much worse than that)..

The tough part about landlording is that you end up absorbing some of the fallout from the deficits and issues in the tenants' personal management skills. 

Be it issues with rent, interpersonal relationships, communication, even violence or drugs and alcohol, their problems become yours for better or worse.

For me, with bricks flying, sirens wailing, guns firing in the first couple of weeks--I get out my check book and wish the wheelchair fellow all the best. Then I see if I can do the same with the other tenant. 

I think I would also say it is "not a fit" or working out and lay out a reasonable cash for keys arrangement (and maybe mention the alternative would be a for cause eviction on the bricks, sticks, and bullets)...

I would just call it tuition at bad tenant university.

That said, if you are going to willingly be in this gritty type tenant group that resolves disagreements with gun play, dodging bullets and such, then I would maybe up my life insurance, get a bullet proof vest (really, I would for late night visits about noise calls) and rent to the remaining tenant and hang tight for her next adventure or interesting co-habitant as you will have a front row seat for all the action.

Best of luck!

@Tyler Mutch , have you talked to the cops who responded to the incident? In Wisconsin if you can get a letter from law enforcement saying your tenant created a nuisance you can give them a 5 day eviction notice.

"A property owner may terminate the tenancy of a tenant who is under a lease for a term of one year or less or who is a year-to-year tenant if the property owner receives written notice from a law enforcement agency, as defined in s. 165.83 (1) (b), or from the office of the district attorney, that a nuisance under s. 823.113 (1) or (1m) (b) exists in that tenant's rental unit or was caused by that tenant on the property owner's property and if the property owner gives the tenant written notice requiring the tenant to vacate on or before a date at least 5 days after the giving of the notice. The notice shall state the basis for its issuance and the right of the tenant to contest the termination of tenancy in an eviction action under ch. 799"

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