My Biggest Property Management Nightmare | Real Estate Investing

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How I Dug My Way Out of MM in Losses Real Estate Investing


I’m going to tell you about my biggest property management nightmare ever. Here goes.

So check this out. In the video below, I discuss a few things.

First of all, I fill you in about the absolute nightmare that this particular tenant put us through. Then, I touch on some of the things that we did wrong, in my opinion, and something you should never do.

I go on to reveal some of the things that we did right and how to deal with a nightmare scenario like this.

What I Went Through With a Tenant From Hell

I once had an absolutely disgusting tenant. Let me tell you some of the things that they did.

This was many moons ago when starting my journey in real estate. At this point, I was still exposed to tenants as the owner of the company. I would take calls and go to the front doorstep to try and calm tenants down and talk to them. (Of course, not having any sort of gap and exposing myself as the owner of the company gave tenants even more ammunition.)

Anyway, what this particular tenant did included constantly complaining about repairs, and once the repairs were scheduled and completed, they were never done to their satisfaction. So we would literally get daily phone calls about certain repairs at that property.

We were just running around like headless chickens trying to satisfy this one tenant, making sure they didn’t have any more repair requests—even though many of them were imaginary and a lot of them weren’t realistic.

She clearly wanted to go out of her way to make our lives miserable. I honestly think it was personal, and there was some sort of jealousy of me, my wife, and our journey. I’m serious when I say she seemingly went out of her way to make our lives absolute hell.

Related: How to Best Prepare for a Tenant Trashing Your Property

Here are a few other things that happened to put it in perspective. We sent contractors on site several times. The feedback we got from three contractors was that she liked to reveal herself to them.

Yes! That’s no lie. We actually had three contractors testify in court that she was constantly taking her clothes off when they were there doing maintenance work.

Another thing that happened is an exterior light exploded—keyword: exterior light. She called the fire brigade and went to the hospital complaining of carbon monoxide poisoning, but in the fire report, they stated it was an exterior light. We actually proved that in court.

This particular tenant also called our broker and complained to them, so we had a lot of issues with our broker. We had just started the relationship with them and we had just started our property management company, so it was tough trying to explain to him what was going on.

She also complained to the division of real estate, which then opened an investigation on our company. We had the board of Realtors knocking on our door, too. How? The tenant somehow managed to get ahold of the landlord who owned that property and reached out to him via phone, email, and letter.

She even reached out to his wife and got in touch with his children.

Where I Went Wrong as a Landlord

So these are the extreme lengths that this tenant went through to make our lives absolutely miserable. I’m not even going to talk about the online reviews, calling our employees, and continuing to post crap for the next two or three years.

It was an absolute nightmare, an absolute disaster, and I don’t want anyone to go through what we went through.

How did this happen? Where did we go wrong?

We determined the initial mistake we made was allowing the tenant to move into the property (at her and her husband’s request) before we finished renovations. Don’t do this!

You should never rent a property to anyone if there are still a few loose ends that you need to button up. Why? Because you don’t want any of what I described happening to you. It gives tenants more power to prove a point in court, saying that the property was not renovated to their standards.

If you are going to move someone into the property before it’s fully renovated, I suggest you have a clause in the lease agreement indicating all the things that still need to be repaired. Then, require that the tenant signs an “as-is” lease agreement.

We did not do this. It was inarguably a mistake.

Related: 12 Tenant Nightmare Stories I Swear Are Actually True

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However, where we were very diligent (which helped get us out of this mess) was keeping a detailed list of absolutely everything that was going on. So whenever the tenant called or texted or emailed, we recorded the time, what they said, we recorded it all. We took things to extreme lengths, where we even recorded the things she was saying when we went to visit her in person.

For instance: “Oh, I’m happy with you guys. The property is in great condition. You’re doing such a great job.”

Of course, these were all lies, but we recorded all of these things. We kept an itemized list of all the things that were occurring.

Another thing that we did well was to catch the tenant on a technicality: they were a few days late paying the rent. In Ohio, we’re very fortunate that it’s a very landlord-friendly state. So if you don’t pay the rent, the landlord does not have to accept late payment—they can file for an eviction.

We filed for an eviction—and thank goodness we did. We went to court, and we ended up settling outside of it. We didn’t end up going for the full-blown eviction. Instead, we got the terms that we wanted.

We had enough information that we could have filed for an eviction, but there was no point. I think I said it in a prior video, just move on. The quicker you can move on and let that negative energy go, the better. Focus on the positive things that happen every day instead.

So that is my story of the tenant from hell, my property management nightmare story. I’ve had others, but this one topped them all.

It was likely super traumatic because it was when I first started my journey and company. I remember getting a little bit of flack from someone who commented about us potentially looking for a technicality in a lease to get a tenant out.

But I can tell you right now, I’ve done it before and I’ll do it again. I have no problem finding any technicality, and I have no problem putting whatever I have to put in the lease to get tenants out if they deserve it.

Whenever we can bend the rules and find a technicality in the lease, I will go out of my way to find it. It costs us money, it costs our investors money, and it costs time.

By the way, for those wondering, we did a background check on this tenant. But we didn’t do it before they went into the property (big mistake). Plus, they had experience suing the government, city, and state. They were essentially professional scammers.

Have you had any instances like mine?

I’d love to hear your story.

 





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