To many first time landlords or even the more experienced ones, the E word, Eviction, is a scary one. It seems like something that only happens to unlucky homeowners or to those who have renters in high crime areas.
While that is wishful thinking, a landlord should have a playbook and be prepared for that nightmare tenant who fools you in the application process or turns into a freeloader while living in one of your most prized possessions, a cash-flowing rental property.
Do Your Homework First
This may sound like an obvious one, but do your research before you put a tenant in your property.
What does that mean for you?
Carefully vet out and screen each prospective tenant by doing such things as checking credit history, getting references from previous landlords, and running background checks. Spending the money on these services can save you major headaches and dollars if past issues can be discovered before it’s too late.
You know what they say: history often repeats itself, so put yourself in the best situation to avoid the eviction process altogether if possible.
Make Sure Your Lease Protects Your Rights as a Landlord
Consult with a real estate attorney, local REI group, or other real estate investors to make sure that the lease you are having your tenant sign is a lease that protects you as the landlord.
You want to ensure that you have a course of action for the difficult tenant who decides to stop paying rent for a period of time, treats your property like a fraternity house, or carries on illegal activities like selling drugs.
Give Your Tenant Proper Notice
If anything mentioned in the above actually happens, or something else occurs that is a breach of the lease agreement, then it’s time to start the eviction process.
As much as you want to change the locks or forcibly remove the person from the house, there are laws in each state that lay out the groundwork on how to evict a tenant. Many states have a streamlined process.
It is important to understand the rules and regulations regarding evictions so make sure to read the local property code and/or consult with an attorney on the proper legal steps to take.
One item that usually rings true for property owners in every state is that the landlord is required to give notice to the tenant of the violation or breach. You will need to tell them in writing that they are late on rent or have violated the pet agreement by having a vicious dog on the property.
Keep in mind that this writing may need to be delivered in a certain form, such as certified mail or hand delivery. After giving the required notice, there is typically an amount of time that is provided in the lease agreement or by local law to remedy the violation.
Many times a straightforward notice on official letterhead will rectify the situation, and you may be surprised that this quickly takes care of the problem.
However, if nothing happens or the tenant doesn’t respond in the allotted amount of time, then the next step is to file a lawsuit.
File a Lawsuit
Filing a lawsuit sounds like a major undertaking as far as complications and expenses, but it depends on the specific laws.
In some states, the landlord can handle this by himself by filling out some simple paperwork at the courthouse and paying for the lawsuit, which includes the fees for serving the tenant with the lawsuit.
Other states may require the use of an attorney to file the eviction which could prove to be more costly since they may bill by the hour or a flat fee.
Either way, if you get to this point, there is no turning back.
If you win the eviction case after appearing in court, the judge will provide an order that gives the tenant a short amount of time to vacate the property peacefully. This undoubtedly will be the preferred method and probably occurs most of the time.
If the tenant still doesn’t want to leave the confines of your home, then the next step involves filing a writ or similar type of legal document that notifies the sheriff or constable to remove the tenant for you. While kicking someone to the curb can tug at the heartstrings, remember that the tenant had an obligation to you when signing the lease. You as the landlord fulfilled your part of the bargain by providing a habitable property. At this point, they have been given ample opportunity to vacate the premises.
Cash-For-Keys As An Alternative Option To Eviction
One creative alternative to consider instead of eviction is something known as Cash-for-Keys. Cash-for-Keys means exactly what it sounds like; a tenant receives some sort of payment in return for leaving the property and handing over the keys.
For example, you can create a simple one-page agreement that says “In return for $500 cash, the tenant promises to clean out the property as well as repair any damage done to the property so that it’s in move-in-ready condition for the next tenant.”
Your first reaction may be, “Why I am rewarding a tenant who has not paid me rent or worse?” However, it may end up saving you time and money in the end.
Yes, there is a bit of pride to swallow in this process, but it could potentially cost you thousands of dollars to hire an attorney, pay the court fees, pay for the set out with a constable, and hire a crew to clean up the deserted property. While it may seem worth it to fight and teach the tenant a lesson, Cash-For-Keys can be a valuable weapon to keep in your arsenal depending on your particular situation.
As a landlord, it is always best to avoid problem tenants by doing your due diligence at the beginning of the application process and through a carefully drafted lease. However, in the event that an eviction is necessary, the above steps should give you some guidance on how to quickly and effectively evict a tenant so that you can get back to putting quality renters in the property and money back in your pocket.
ABOUT LONGHORN INVESTMENTS
Longhorn III Investments, LLC is a direct private lender offering short-term acquisition and renovation capital to real estate investors for both residential and commercial assets. We operate in major metropolitan areas throughout Texas, Missouri, Indiana, Tennessee and North Carolina.
Highlights of our loan program include:
– Up to 70% of ARV (after repair value)
– Finance up to 100% of cost
– Close in 3 – 5 business days
– No income requirements
– Streamlined, simple approval process
– No prepayment penalty
Longhorn was formed in 2008 and has funded over 2,500 loans since inception. Our complementary businesses include a title company and real estate law practice operating out of our corporate office. Our wealth of experience puts us in the unique position of being able to help investors through all aspects of each transaction.