Most rental property owners eventually face this question – what to do when a tenant breaks something? Rental properties require constant inspection and maintenance, but some of those costs should be justifiably paid by the tenant when they are clearly responsible.
Here are a few property management tips for dealing with the unfortunate situation when a tenant breaks something.
1. Document the problem. As soon as a problem is discovered, document it with a written preliminary inspection report supported by photos and/or video.
2. Get written repair quotes. Depending on the specific problem, you may need to have it inspected by a qualified contractor. Ask the contractor for a written inspection report and repair quote. If the quote is over $200 (or another limit you choose), ask for quotes from a couple more contractors to make sure you get a fair price.
3. Determine who will pay for repair. Determine whether the item has been broken or damaged due to tenant abuse or negligence or that it occurred as a result of normal wear-and-tear. Unless the damage is through normal wear-and-tear, the tenant should have to accept responsibility.
4. Advise the tenant formally. You will probably inform the tenant verbally that you’ve found a problem, but if you expect the tenant to pay for the repair you need to notify them formally that you consider them financially responsible. When handing them the written notice requesting that they pay for the repair, request a delivery receipt or send it Certified Mail, Return Receipt. Give them the opportunity to rebut your claim. If the rebuttal is bogus you’ll need a good paper trail to justify your assessment of responsibility and the repair cost.
5. Determine how the repair will be paid for and collect fast. Some tenants will willingly pay out of pocket or add the cost of the repair to the next rent check, but it’s important to collect on this debt as quickly as possible. Some tenants will say “take it out of my security deposit.” Tenants who say that usually leave damage at move-out that costs more to repair than the amount of their deposit, so it’s best to get the repair costs paid immediately and separate from the security deposit.
Here are some tips for deterring tenant abuse or breakage:
- Document the condition of the property at move-in. Landlords often complete a move-in checklist noting discrepancies, but that’s just half the job. It’s also important to document that everything is in good condition. Up-close photos of appliances, fixtures, doors and other features that could be easily broken or damaged provide evidence that the items were in good working condition when the tenant accepted responsibility for the property.
- Conduct regular inspections. Quarterly or semi-annual interior and exterior inspections are a great way to reduce many kinds of problems. Include a clause in your lease that advises the tenant that these inspections will be taking place and that you have the right to enter the property any time with 24 hour notice.
- Use rent coupons. The most common tenant response to an eviction notice is “the landlord didn’t maintain the property in an inhabitable condition” or something along those lines. They’ll say the furnace hasn’t worked in months or the plumbing is backed up – anything to stall the eviction and justify not paying rent. A handy tool to counter these claims is a rent coupon. When the tenant signs their lease, hand them a dozen or so pre-printed coupons that indicate the property address, the tenant’s name, and amount of rent due each month. Provide a space where they can describe any problems with the property. If there are no problems, provide a check box that says “There are no problems with the property at this time, everything works properly and nothing is damaged.” Also provide a line where they sign and date the coupon. Require a coupon with each rent check. This often deters tenants from abusing the property and, if necessary, can be provided to your eviction attorney to support your claim that they property has been properly maintained.
NOTE: This article is not intended to offer legal advice. Consult with an attorney whenever faced with the legal side of lease compliance issues.
If you have questions about our property management tips or need help taking action when tenants break something (or other problems), read about our Property Management Services or drop me a line: Contact Us.