Bad tenants are difficult, but not impossible to avoid.  Getting one will make you question why you ever got into the investment property business. They can be difficult to get rid of and may leave you somewhat gun shy to rent to anyone again.  So how can you do your best to avoid bad tenants?

• Look at how and where you are advertising.  Do you put a $1.58 sign in the yard with handwritten information on it?  Alternatively, advertising on-line will at least bring you tenants that own a computer and maybe have a job.
• Where your property is located may give you a higher percentage of bad tenants.  Some neighborhoods have landlords that do not perform any background checks on their tenants and therefore the area does attract tenants with past problems.  These bad neighbors may be spilling over into your applicants.
• What are you renting your home for?  I have found that if you discount the rent, you will actually be getting calls and applications from tenants that are not as concerned with living in a nice place.  These same tenants seem to have problems that follow them including non-payment of rent, police calls, and damage to the property.  If you can push the rent to your home higher, but also put out a better product, you will find the tenants that want more than just a roof over their head.
• What is the condition of your rental unit?  This is similar to the above unit.  If the tenant sees that you don’t care about your property, they may think that you are going to be an absentee landlord and let them get away with things.  They are also not going to care about you or your building.
• Sit down and write up a tenant screening criteria. It may be simple such as no previous tenant evictions and no felonies and at last a 500 credit score.  It doesn’t matter what the criteria is, but then when you get a tenant application, you must stick to those criteria.  Every year re-evaluate those criteria to see if you should change them.  I suspect that if you look at the tenants that have been problems over the last 12 months, it is because either you deviated from your criteria or your criteria was too low.
• When screening tenants, you should do a credit, criminal, and rental background check.  Make sure to do all three.  Pay to have a service do it so that you are not missing any piece of it.  Charge the tenant applicant the cost.  The added benefit of charging the fee is that tenants with problems in their past will typically not apply!
• Call the tenant’s previous two landlords.  Insist  that you will not rent to someone unless you speak to both the last landlords.  These people should be able to tell you what that tenant was like, how they paid rent, and if there were any issues.  Ask them if they have ever had to send an eviction notice letter to that tenant.  These landlords may also be great contacts for future eviction advice.

Taking a holistic approach to your entire tenant screening process should shed some light on where the bad tenants are getting in.  Clean those areas up as soon as possible and continue to refine the process to make sure you can spot them early.

My customer bought a house recently with a tenant already in place.  Upon buying the house, the tenant immediately bounced the rent check 2 days prior to the closing to the previous owner.  So the seller was not able to pay out the July rent.  We could not move forward with an eviction on the tenant as the property was owned by the seller at the time.  We had to wait till this month.

Sure enough, rent never came.  I pulled the eviction notice down off the county website and promptly filed the eviction.  My customer spoke to the tenant several times between filing the tenant eviction letter and the court date.  By the end, the tenant felt like my landlord was the devil.  They were starting to claim that there were health concerns with the property and was threatening to bring in the health department.  I assure you my customer is anything but the devil and is actually a very personable and generous person and landlord.  In the end, he offered to simply let the tenant leave at the end of the month and not pursue for back rent.  The tenant would have none of that.

So court date comes.  I get to court and the tenant has an eviction lawyer with.  Oh boy, this is going to be interesting.  Once the court clerk calls roll, we connect in the hallway and get a conference room.  The attorney was professional and stated that there should not have been an eviction filed because the tenant was supposedly offered $1500 to move out earlier in the month plus all the damage deposit back.  I had not heard of this from my landlord.  While the tenant started up several times with what was wrong with the property, I kept focused on the attorney.

After several rounds of negotiation, we agreed that if the tenant moved out in 1 week, my customer would not get the writ and would give back the entire damage deposit.  While this seems like we were rewarding bad behavior in the tenant, by them not paying rent in 2 months, I looked at it like this:

1. This tenant had already shown some mental instability.  This person was now making things up that were untrue, but the landlord would have to defend the accusations.
2. Because the tenant had already brought an attorney into this, I expected they were serious about continuing to defend themselves and would refuse to be reasonable.
3. My customer just wanted the property back in a timely manner, not accepting this deal, would have pushed the case into trial which would have delayed the move out at least another week.
4. If the eviction case went to trial, my customer would need to hire his own eviction attorney to counter the tenant’s attorney, costing him probably as much as the security deposit.

In the end, the smooth handle was the easier path, albeit it did require a bunch of pride swallowing and lip biting on my party to not defend the landlord!

In this blog you will hear the problems that happen with tenants time and again.  Don’t get me wrong, many tenants can be excellent.  They pay their rent on time, they keep the place in good order and they are generally extremely pleasant to deal with.

And then they buy their own house.  Let’s be honest, if they’re model tenants, even if they are on Section 8 or they’ve taken a dive in their credit score, they will be the type to get their act together and get a deposit and persuade some mortgage company, even in today’s climate, to lend to them to get a place of their own.

Then you can get a less pleasant type of tenant.  The rent may be late, you may be threatened with some spurious claims on the Minnesota code and there may even be some malicious damage.  In all three of these situations the right type of insurance can save you some headaches, and this does mean getting the insurance from the right place.

Firstly with the rent being late, there is no way that ordinary owner occupier home insurance is going to cover this, although many types of landlord insurance policies cover precisely this sort of issue.  They do expect you to actually chase the rent and show that you’ve been chasing the rent, but insuring for non payment of rent is an option with landlord insurance.

Then you get the threats of spurious claims.  The legal insurance on a domestic insurance policy is going to be negligible.  Why?  Well you could get someone falling on your path as they try to deliver some junk mail, but the time that someone is on your property when you live in it is going to be minimal while the time that someone will be on your property when they live on it could be close to 24 hours in a day.

Finally there is the malicious damage.  Landlord insurance covers this sort of risk well, and prices it accordingly.  Domestic insurance providers very rarely see this type of damage.  Yes you may have some delinquents knocking down a wall if you live in a house, but they aren’t going to have the chance to block up your gas supply.

It’s because of these risks that many mainstream home insurance providers will simply invalidate your policy if they find out that you are renting the insured property out.  The idea that of course a domestic insurance policy may cover everything but it’s cheap is wrong for this reason as well as others.

Essentially you need some good advice and a wide choice of providers, and you need to get a specialist.  Where should you go?  Give these people a try.

After taking the pictures, I will often store the property in one of the bedrooms if I have enough time between tenants.  Otherwise, I move it to the basement or garage.  Keep in mind that you must protect this property against theft and damage.  Any old food or dishes can be discarded as well as anything that is obviously junk or trash (be sure your definition of junk is the same as the tenants!).

I have to say that although I rarely see any tenants coming back to claim their possession, I still do it.  With that said, I hate it!  Why do I have to store their stuff that they obviously did not care enough about to move with them?  The worst is when I have evicted the tenant for owing me money and now I have to store their junk.  It ads insult to injury.  While I can’t give you eviction advice, most landlords in this situation would never store the tenant’s left over stuff.

Well here is some small, but good news.  Affective August 1, 2010, landlords only need to store the tenant’s abandoned personal property for 28 days.  This is a welcome change.  I suspect the legislator realized that if you are not coming to claim your stuff after 28 days, you are probably not going to get it.

I did the best job I could.  I made mistakes and learned from them.  You could say that I learned how to be a landlord at the school of hard knocks!  Then it happened, a tenant stopped paying her rent.  I needed to do an eviction.  I found that there was even less information out there on how to do an eviction.  I didn’t know anyone that had done an eviction, there were zero resources on the internet for me in Minnesota, and even the court website was pretty bad.

After doing many evictions now, here are some thoughts that I have on where to get good eviction advice:

• Probably the most important item is to gain the knowledge before you need it.  In the military, they train the soldiers with live weapons and even do simulated combat training.  This is so that when they actually do enter combat, they have some experience to deal with what they encounter.  Doing evictions should be the same way.
  • Head down to eviction court, get a copy of the documents that you need to fill out for an eviction.  Talk to the workers at the counter, ask them about the process, how long it takes, what it costs, what mistakes are common.  Suck up info from them.
  • Find out when the next eviction court date is and attend.  These are typically open to the public so just sit in back and listen to what the judge asks, what the landlord says, and what the tenant does.
• When it it is time to do your first eviction, you may want to consider hiring an eviction lawyer.  This person will go through and do all the work for you, but ask them to include you in the process (you are paying them, so they should be willing to do this).  If your jurisdiction requires a tenant eviction letter, have the attorney give you a copy once it is sent.
• Whether you do the eviction yourself or hire a lawyer, make sure to save copies of everything so that you have something to refer to later when you have to do your next eviction.  Filling out that printable eviction notice, will always be confusing if you don’t have a reference to look back at.
• If possible, find another experienced landlord that you could take to lunch to pick his brain about doing an eviction.  He would probably be happy to share his stories and lessons learned.

Doing an eviction can be an intimidating process.  Finding places that you can get good eviction advice is an important first step in making it easier.

Regardless, now it is time to do an eviction.  Take some time to learn more about how the process works.  Here is an example of the steps involved in a Minnesota eviction:

1. Go online to the county website.  Download the free printable eviction notice.
2. Take the required paperwork down the to county courthouse, pay the fees, wait for the eviction notice to be prepared.
3. Once it is prepared, you need to have the documents served.  This must be done properly and by a neutral 3rd party.  I often use a legal courier company because they specialize in doing this for attorneys often.  They understand the process.
4. Now you wait up to 2 weeks for the court date.
5. At court you go before the judge and explain why you want this tenant evicted.  The tenant will most likely argue with  you and hopefully you can work out a compromise.  If the facts of the case are in dispute, the judge may order you both to a trial to decide who is correct.

While there is a lot of simple administrative busy work that goes into filing an eviction, it needs to be done properly.  Additionally, it takes time to go to the courthouse to file the eviction and then return for a court date.  All of these reasons may be a good idea for you to consider using an eviction lawyer.  These professionals do dozens of evictions each month.  They understand the process, legalities, and any loopholes that the tenant may use to slip out.

If you are too busy or too nervous about evicting your tenant, let some eviction lawyers handle it.  You simply turn over the information to the attorney and let them do everything.  You get a call after the court date telling you about the outcome.  You don’t have to waste your time running all over and you don’t need to have any confrontation or negotiations with your tenant.  What a great way to get this messy situation cleaned up!

Several people were looking for a printable eviction notice or a free printable eviction notice.  I am not really sure what they are looking for, but here are some thoughts about their line of thinking and the problems with it:

An eviction notice form is specific to the county or legal jurisdiction that you live in.  I would be very suspicious of a generic one that I found on the internet.  How do you know that it was created with all the legal requirements for your area?  Plus, these documents are usually free at the county courthouse or you can download them from their website.

Using an eviction notice that was not generated by your local jurisdiction could invalidate your claim in court.  A tenant or their attorney could simply show the judge that you did not follow the law when you filed the eviction.  Unfortunately, judges love procedural mistakes and I am sure they would throw out your case in a second.  This will be a huge frustration causing you to lose the money you spend filing the first eviction, not to mention the extra time it will take to get the tenant out of the property.

Alternatively, if you are simply looking for an eviction letter, which is essentially a warning document that you can send to the tenant to tell them what they need to fix or do, then I would be fine using something I found on the internet.   I would still compare it against the local legal requirements for your area if this is a required part of evictions in your area.

When using the eviction notice as a simple warning letter, you can actually find an eviction notice in Microsoft word.  You can go to www.office.microsoft.com, search for Word Templates for the version of Word that you are using.  Put Eviction into the search box and it should bring up a couple templates that you can use.  How easy is that?

Before downloading a printable eviction notice from the internet and assuming it just will work for your needs, check with your local courthouse to confirm it would be OK to use a non-legal binding form like this.

An eviction letter can mean different things in different areas.  In some areas, this is actual eviction notice letter, in others it is simply the official notice to a tenant that eviction is eminent if they do not remedy the lease violation.  Here are some thoughts about the eviction letter.

• Stop down at the local courthouse where the eviction is filed to understand all the requirements of the eviction process.  If you have properties in different counties or different states, the process may be different.  Make sure you understand each jurisdiction.  You can find printable eviction notices at your local courthouse website.
• Your location may require a Notice to Quit which is different than an eviction letter.  This is typically used where the eviction letter is the formal process of eviction, then the Notice to Quit is the warning.
• Be sure you understand the eviction process time line required.  Some places allow you to file for an eviction immediately, others make you wait 30 days.
• Have an action plan for both the property and tenant before you write and send the eviction letter.  Are you OK if the tenant simply resolves the lease violation or do you really want to push them out of property?  If the tenant calls you when they receive the notice of eviction, what are you prepared to tell them?  Remember that they forced you into this situation and you should not back down or take more excuses.  Stick to your guns!
• Write the letter in a professional tone.  Do not include any hearsay or rumors.  Stick to the simple facts that you could prove in court (you may have to).  Refer to the lease agreement when possible to prove your argument.  Explain what the tenant needs to do to remedy the situation.  Also include what and when your next action will be, which may include filing the eviction.
• Have the letter sent via certified mail or have it served by a process server so that you have proof that the tenant has received it.  If you hand deliver it yourself, have a witness with you and have that witness sign an affidavit stating that they saw you hand the letter to the tenant.  Document the date and time.
• If you are not comfortable with the eviction process, you may want to consider finding eviction lawyers that can handle your case and tenant.

Using a tenant eviction letter is a less expensive, quicker, and often very affective way to get compliance out of your tenant.

When you are ready to get started, it can feel it is your first day of high school as a freshman.  You see all the older kids walking around, knowing where they are supposed to go, and you are just trying to not make a fool of yourself.  Well, real estate investing is just like starting anything else such as a new hobby, job, school, or church.  You just have to jump in and get started.  Just as important, though, is to find people you can trust to give you solid competent advice and help you navigate this new territory.

Here are some quick tips on how to get started as a real estate investor:

1. If you haven’t already, read everything you can get your hands about all the different types of real estate investing.  Be sure, though to read books that were written in the last 5 years.  While Think and Grow Rich by Napoleon Hill may be a classic investing book, it was also written over 20 years ago!  Also keep in mind that some of the techniques that are recommended in the books may not work or even be legal in your area.
2. Decide on what part of the real estate business you would like to work in such as:  rentals, flipping, commercial, multi-family.  Use the knowledge that you learned from the books you read to help you decide.  If you need more information, join an investors club and talk to many different investors to see what interest you and what you feel comfortable with in regards to risk.
3. Buying investment property can be tricky without the correct financing.  Find a mortgage banker that specializes in real estate investing.  Make sure you agree with his risk tolerance and feel comfortable with his recommendations.  This will be a long term relationship so make sure you like and trust him/her.  This person should preferably own investment properties of the same type that you are interested in acquiring.  This will make their advice come from practical experience and you will be able to lean on them for landlord advice.
4. When you are meeting with both the mortgage banker as well as the investors club, ask who they would recommend for a real estate agent.  Just like the mortgage banker, this person will be one of your closest advisers and they should work in and own the type of investment properties you are going after.  This person should understand the market and have your best interests in mind.
5. Once you have these two key advisers in place, get out and start looking at properties and making offers!  Many investors spend their entire time analyzing deals and never get in the game.

Starting off correctly will insure that you are on solid ground when you finally decide to purchase your first investment property.  This will help you minimize filing an eviction notice.

What is eviction?
Eviction is a legal process by which a homeowner can be asked to leave the house after it is foreclosed. If the homeowner or his family members does not leave voluntarily, they can be forced out of the house and the new homeowner will have the right to do whatever he wishes with the contents of the house.

What are the laws related to eviction?
Laws that guide eviction procedure varies from state to state. However, in all the states, it is mandatory to serve the defaulter with an eviction notice before the actual foreclosure eviction takes place. So when you are served with a notice, you must check the deadline mentioned on it. Generally, the deadline is 3 to 5 days from the day of its issue. It is better to leave the house by the specified date. But before doing this, you must find out if your state allows a redemption period to enable you stay in the house before the actual eviction takes place.

What is right to redemption?
In some of the states, homeowners have a right to redemption. With the right to redemption, homeowners can reclaim their home during or after foreclosure by paying the outstanding mortgage balance along with the cost incurred by the lender due to foreclosure. So, if your financial situation improves during the redemption period, you can take advantage of this right and get back your property. The redemption period differs with states and is generally around 3 to 12 months.

However, if you are unable to reclaim your house and do not have any other shelter, you can seek help from your county housing authority.