My Top 10 Landlord Mistakes to Avoid!
If I shared all my mistakes as a landlord in one article, you'd get tired of reading it before the first hour, so I'm limiting it to only ten big mistakes that made me want to kick myself. Some of my mistakes are very common to many landlords, but most are the result of me trusting the wrong people. In this business of being a landlord, we eventually learn that trust has to be earned. We just shouldn't trust everyone we meet.
Below I've listed "10 Landlord Mistakes to Avoid" - but were important lessons in being a better Landlord!
I made most of these screw-ups many years ago, but some are easy to repeat in a bad rental market. That is why I still say, "Nerves of steel- It is better to have NO tenant than a BAD tenant."
- I failed to check the tenant's ID!
I knew something was wrong when the rent for the second month was a challenge to collect. After a few months I learned the tenant's real name from a neighbor! I knew God loved me when he was arrested by the FBI for fraud.
- I skipped the credit report!
They seemed like they had it all together. Well dressed, nice car, the application checked out...
- I trusted a fellow landlord and Realtor
who "vouched" for the tenant! - Now whenever a fellow landlord or Realtor "vouches" for a tenant, I ask them if they will be comfortable co-signing. Trusting a fellow Realtor? I should have known better. No offense to the many hard working honest fellow Realtors out there!
- I allowed a tenant to do home improvements.
Just because someone tells you he is "handy", doesn't mean he really is. I still have nightmares about the unauthorized homemade shower stall in the front coat closet... hose...linoleum...holes drilled draining into the basement... aaaaah!
- I didn't increase the rent for fear of "rocking the boat"!
Even a small modest rent increase like $10. is better than none at all. In fact, if you are determined to do NO increase, at least send an increase letter to make a point that because of rising carrying costs, there should have been an increase but you are forgoing the increase because of their fine tenant performance.
- I waived the late fee!
Just trying to be friendly and avoid confrontations. Build a good landlord tenant relationship... Ha! What a fool I was! You've got to read my article on collecting late fees from tenants who won't voluntarily pay it.
- I didn't start eviction because I believed the tenant was telling me the truth all those months about the money coming!
Talk about being a sucker! Boy was I naive!
- I accepted a tenant with BAD CREDIT!
She seemed so nice. So honest. Of course all those banks made a mistake on her credit report. Besides it was probably the ex-husband who ruined her credit. Mary would never lie to me. Some times you just have to trust your gut and take a chance on somebody, right? Wrong!
- I didn't bother to get a signed Property Condition Report!
I learned that when I do not get a signed property condition report, the tenant conveniently forgets what excellent condition the property was in when they took occupancy. But when I have them sign a condition report at move-in, it definitely makes a difference in how they treat the home during their stay.
- I didn't bother to get a signed Credit Reporting Disclosure!
Before it was part of my regular lease signing routine, I would often forget to use this form. Whenever I forgot, I regretted it! It is a simple fact that when we have a tenant sign a credit reporting disclosure, they make a conscious effort to make their rent payments timely. Why? Because good tenants want to keep good credit. When they think their rent will affect their credit, they prioritize the rent payment.
I hope you found some of my past landlord mistakes entertaining, but more importantly, I hope I may have helped someone avoid making any of these mistakes themselves.
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