Help! My tenant is a drug dealer.

Real Estate Agent · Corona, CA · Member since 2018 · 15 posts · 9 votes

My husband and I purchased our first investment property. We renovated it and found tenants to move in on the first of this month. Today, someone randomly reached out to us and warned us about this tenant. That he is a nightmare tenant. That he also has a record of trashing properties and that he is a serious drug dealer.

Any suggestions on how to move forward with this situation? Any advice would be greatly appreciated. Thanks so much.

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Anna Sagatelova

Property Manager · Cleveland, OH · Member since 2019 · 446 posts · 566 votes

Hi all, PM here.

If a PM was responsible for the screening, their screening procedure absolutely should include past residential history with contact information for each landlord. You should ask them about their full process and go with a PM that has a comprehensive screening procedure that goes beyond a background check.

In any case, you have a lot of people here saying that a background check tells you more than a random stranger/neighbor, and I'm here to say that is not always the case. There are plenty of drug dealers out there with no criminal record. I'm not saying you should trust every accusation, just that a clean background check is not alone a reason to dismiss a neighbor's complaint. It's just very unclear who this person actually is. Is it a former landlord? A former neighbor? A former roommate? A competing drug dealer?

Finally, read the lease this tenant signed. Aside from when it expires/whether it's M2M, do you have a "drug free housing" clause/addendum? That can be a way for you to evict immediately, if the issue turns out to be real.

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Clint G.
Rental Property Investor · Corpus Christi, TX · Member since 2019 · 306 posts · 176 votes
6y
Did you do a background check? Might be too late now, but something to think about in the future.
12 Reply
Luis Espinoza
Investor · San Diego, CA · Member since 2020 · 21 posts · 37 votes
6y
Hi Jocelyn,
Congrats on the first investment property! How long is the lease term for? If it's month-to-month and you truly don't want that person in there after hearing this, then just reach out to them to tell them that you will be terminating their leave in the upcoming month. If it's a longer lease, then I would keep a close on eye on their behavior and use one of the clauses in the lease as a reason for termination if they break it. Completely legal if your lease is set up correctly.
Couple of other thoughts....
1) How did the tenant screening process go? If you did your due diligence, then the tenant should not be a problem. Was there anything in his background check that threw you off? Anything from the last two housing references? from the work reference? If you didn't do any of these things, make sure you take it as a lesson for future tenant searches. BP has great content for finding good tenants. I would recommend the BP book on Rental properties.
2) How much do you trust this "someone"? They could honestly just be an ex trying to ruin this person's life! If you trust them, then fine take it as a reasonable warning. If not, then why be so concerned? I would just continue to closely watch the tenant and trust your tenant-screening instincts, there is a reason you accepted this tenant.
Best of luck! Great learning opportunity here.

14 Reply
Jocelyn Doumani
OP
Real Estate Agent · Corona, CA · Member since 2018 · 15 posts · 9 votes
6y
@Clint G.
Hi Clint. Yes, we did do a background check on him. He doesn’t seem to have a record.
0 Reply
Bjorn AhlbladPro Member
Investor · Shelton, WA · Member since 2017 · 6k+ posts · 6k+ votes
6y
@Jocelyn Doumani your screening process should reveal much more about this tenant than some random accusation. So what is the bottom line? Did you screw up or is this person falsely accused?
5 Reply
Jocelyn Doumani
OP
Real Estate Agent · Corona, CA · Member since 2018 · 15 posts · 9 votes
6y
@Luis Espinoza
@Luis Espinoza
Thank you Luis for such wise advice.
We hired a property manger and they did a background check on him. He does not have a criminal record. I believe our mistake was that we did not ask him to provide a renters reference. This would’ve given us more clarity on the matter.
This is definitely a learning experience for us and we can’t thank you enough for taking the time to provide some knowledge on the situation. Great book suggestion. I’ll make sure to read that next.
Take care & appreciate the feedback
2 Reply
Travis C.
Investor · Jamestown, ND · Member since 2017 · 32 posts · 32 votes
6y
The question is did your property manager actually do a background check and screening or did they just "pick" the first person that came along?
10 Reply
Michael Noto
Real Estate Agent · Southington, CT · Member since 2008 · 5k+ posts · 3k+ votes
6y
@Jocelyn Doumani From the info you provided you are only getting one side of the story. I would get more information before jumping to conclusions. Welcome to being a landlord!
7 Reply
Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votes
6y
If you hired a good PM to do the background check and screening all you have is the word of a stranger who may have something against that person. Are you managing the property or the PM? Whoever is, have them do regular inspections every 3 months.
5 Reply
Adam Azam
Investor · New York, NY · Member since 2020 · 119 posts · 84 votes
6y
Charge it to experience, i wonder how that slipped from the PM's screening.
3 Reply
Anna Sagatelova
Property Manager · Cleveland, OH · Member since 2019 · 446 posts · 566 votes
6y
Hi all, PM here.

If a PM was responsible for the screening, their screening procedure absolutely should include past residential history with contact information for each landlord. You should ask them about their full process and go with a PM that has a comprehensive screening procedure that goes beyond a background check.

In any case, you have a lot of people here saying that a background check tells you more than a random stranger/neighbor, and I'm here to say that is not always the case. There are plenty of drug dealers out there with no criminal record. I'm not saying you should trust every accusation, just that a clean background check is not alone a reason to dismiss a neighbor's complaint. It's just very unclear who this person actually is. Is it a former landlord? A former neighbor? A former roommate? A competing drug dealer?

Finally, read the lease this tenant signed. Aside from when it expires/whether it's M2M, do you have a "drug free housing" clause/addendum? That can be a way for you to evict immediately, if the issue turns out to be real.
21 Reply
Matt M.
Specialist · Easton, PA · Member since 2018 · 1k+ posts · 2k+ votes
6y
@Jocelyn Doumani
I agree, there’s 2 sides to every story. I once got a call from an on/off boyfriend about a tenant, said she’s disgusting, there’s bugs, house is a wreck. I called the next day and said I needed to check the furnace. House was just fine, no mess, no bugs.
4 Reply
Shiva Bhaskar
Investor · Los Angeles, CA · Member since 2017 · 523 posts · 476 votes
6y
I would investigate, but be careful with accusations. People are crazy, and will make horrible accusations. The guy might have annoyed someone and they are on a vendetta. I heard a podcast about a women who made an Internet comment that annoyed someone, and the other person contacted her employer, landlord, many other anonymously, and tried to ruin her life.
I suggest throughout credit and background screening, and renter references if possible, and go from there. If you get any whif of criminal activity, contact police, and move to evict.
3 Reply
Zachary McDonough
Rental Property Investor · Accokeek, MD · Member since 2020 · 106 posts · 87 votes
6y
@Jocelyn Doumani
So I made the mistake of not running the background research on a tenant and end up with a drug dealer in a house that was rented out by room.
It was a mess so..... I offered to pay the fella and help move him if he agreed to sign a lease termination document!
It worked ! Thank God !
4 Reply
Zachary Ray
Investor · Durham · Member since 2017 · 589 posts · 251 votes
6y
Okay we understand that a mistake was made or the screening wasn't sufficient. Lets move on and figure out how to get them out. Contact a local real estate attorney to assist you with getting them out.
2 Reply
Joe SplitrockPro Member
Moderator
Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes
6y
@Jocelyn Doumani my first concern would be that the Property Manager didn't do what they said they would do. The fact they didn't contact rental references is problem. I would ask to see a copy of their file, including background check and credit report. Look at the addresses on the credit report and look for apartment buildings. Call the manager of those apartment buildings (assuming their application gave release for references). If the credit report is clean with no late payments or judgements, that is a good sign of responsibility. Tenants who trash properties and deal drugs rarely have a good credit reports, because responsible people don't deal drugs.
Another thing you want to do is quarterly property inspections. You can use changing smoke detector batteries or changing furnace filters as the reason to enter the property. Note the condition when you enter. If it is multifamily, I would install security cameras. Drug dealers and drug users do not like being caught on camera.
As far as those saying you should "get them out", you have no grounds to do that. Monitor the situation, but until such time that they break their lease or break the law, there is no court in the country that will let you evict them. Realistically if they are not doing anything wrong, why would you want them to leave.
3 Reply
Adam Martin
Rental Property Investor · Member since 2020 · 1k+ posts · 1k+ votes
6y
My question is how did this person find you if going through a property manager. As others have said there are 2 sides to every story and this person could just be mad at the tenant and trying to ruin their life. On the other hand everyone's criminal and credit file is clean regardless of what they are doing until they get caught or sued. On pretty much every post where someone is having a problem with a tenant our advice seems to be cash for keys which leaves the tenant with a clean record, money in their pocket, and not a single repercussion for their actions. We are also not doing fellow landlords any favors going forward, many of us probably wish we had gotten a heads up from a credit report from a repeat offender however I worry tenants are being conditioned to cash for keys since it is simpler and often cheaper for us. My advice is trust but verify both, they passed your screening so you are probably stuck with them unless they break the lease but this is one I would probably do more frequent air filter changes on.
2 Reply
Raul R.
Rental Property Investor · New York City, NY · Member since 2017 · 493 posts · 386 votes
6y
@Jocelyn Doumani
If your tenant is paying rent and keeping property in order I don’t see an issue..
Don’t go by a rumor get facts
5 Reply
Steve Smith
Member since 2020 · 217 posts · 167 votes
6y
If you have a PM, he should have properly check out the tenant prior to renting. It's his problem to fix and he should take care of it should the tenant violate the lease agreement. There's an argument for a month to month lease so that anytime you want someone out, easy to do.
Now, is the tenant a REAL problem and has he really violated the lease? If he's taking care of the property and paying the rent on time, keep him. This is assuming he's not doing something illegal, but that would be HARD to prove without a conviction.

I had a drug runner tenant. One of my best tenants, but I didn't know he was running drugs, as he claimed he was self employed and that checked out fine. Said because if his self employment he couldn't get a loan to purchase so wanted a long term rental agreement. He gave me $25k for that lease with option (in my favor) and great rent money. He lasted a few years, build a screened in pool for me and I took the property back when he went to jail. Got kinda exciting when the neighbors called me and said the feds are in the bushes, guns drawn, waiting for him.
7 Reply
Steve Smith
Member since 2020 · 217 posts · 167 votes
6y
If you have a PM, he should have properly check out the tenant prior to renting. It's his problem to fix and he should take care of it should the tenant violate the lease agreement. There's an argument for a month to month lease so that anytime you want someone out, easy to do.
Now, is the tenant a REAL problem and has he really violated the lease? If he's taking care of the property and paying the rent on time, keep him. This is assuming he's not doing something illegal, but that would be HARD to prove without a conviction.

I had a drug runner tenant. One of my best tenants, but I didn't know he was running drugs, as he claimed he was self employed and that checked out fine. Said because if his self employment he couldn't get a loan to purchase so wanted a long term rental agreement. He gave me $25k for that lease with option (in my favor) and great rent money. He lasted a few years, build a screened in pool for me and I took the property back when he went to jail. Got kinda exciting when the neighbors called me and said the feds are in the bushes, guns drawn, waiting for him.

1 Reply
Marc RiceBusiness Member
Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2018 · 2k+ posts · 1k+ votes
6y
@Jocelyn Doumani
Collect royalties...or just enforce your lease that if he breaks the law you can evict.
[email protected]614-363-2787
Marc Rice | Investor Friendly Agent at Reafco Tailwind Team574 Reviews
Website View Page
0 Reply
Ryan Cleary
Investor · Palm Beach County, FL · Member since 2019 · 370 posts · 330 votes
6y
@Jocelyn Doumani
Don’t worry, every great landlord has their beginner mistake story. You will be fine :)
3 Reply
Vincent Mazzaferro
Rental Property Investor · Elmwood Park IL · Member since 2016 · 45 posts · 10 votes
6y
Listen to @Joe Splitrock.
Firstly, give him the benefit of the doubt and remain friendly and professional. If you think he will trash the apartment, schedule inspections (frequency based on your perceived risk). You have the right to inspect your property, as long as you wrote that into your lease. Communicate periodically and set your expectations for maintaining the property. If he pays the rent, is friendly to neighbors, and maintains the property, then do nothing. If he begins to destroy your property, document it, fix it, and send him the invoice. If violates the lease, put it in writing and send him a warning notice via certified mail. Break the lease if he continues to violate the terms and conditions of your contract.
Manage the property like a professional.
2 Reply
Patricia Steiner
Real Estate Broker · Hyde Park Tampa, FL · Member since 2019 · 2k+ posts · 3k+ votes
6y
Questions: Do you have really have a problem or a manufactured drama?  What has been the experience with this guy so far? Who is the "random person," how does he/she know him, did he/she speak to you directly or was this an anonymous report? A lot of people have a whole lot of nothing to do during the pandemic - and it tends to leave a whole lot of time for a whole lot of stupid. This could be a whole lot of nothing more than a personal vendetta by an ex-spouse/employee/more.

Until you know you have a problem, be careful how you respond. A big time drug dealer who trashes properties? Huh? Most big time drug dealers have a lot of people coming and going at all times day and night so that's a pretty easy task to observe. Neighbor complaints generally do this folks in.
But here's what you do know: you hired a PM. You're paying that person. Leave this with the PM to monitor and manage. The best defense is to manage to the lease.
This all might be a whole lot of nothing. Fingers crossed...
4 Reply
Vincent Mazzaferro
Rental Property Investor · Elmwood Park IL · Member since 2016 · 45 posts · 10 votes
6y
Sorry, I forgot that you hired a manager. That is what the manager should do. Good point by @Patricia Steiner.
0 Reply
Judy Parker
Rental Property Investor · Closter, NJ · Member since 2015 · 884 posts · 722 votes
6y
Originally posted by @Jocelyn Doumani:
Did you have the Tenant provide you with a Renters Insurance policy, just in case the Tenant does damage the property?
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