Some people inherit expensive jewelry, money, sentimental objects…you got an inherited tenant.
Lucky you. Welcome to the club.
You’re not the first or last landlord to end up with an inherited tenant, but here’s practical advice on what to do with inherited tenants. If you have concerns about the quality of tenant or the way things were run under the former landlord, here’s what you can do to let tenants know that a new sheriff is in town.
Move them to a month-to-month lease before you commit to anything longer.
A majority of landlords who have firsthand experience with inherited tenants agree that moving the lease to M2M is the best course of action. This way, you can get to know them while having them on a lease and eviction is easier—in case they turn out to be capital-T Terrible Tenants.
Make sure your lease is what YOU want.
You don’t have to give them the same terms and conditions as the last landlord. Ensure your lease is written how you want it to read with the policies you want. As always, make sure your legal representative has overviewed everything to make sure it’s legally compliant.
Let them know you have a late fee policy and it will be enforced.
If the last landlord or manager was a little lax on when rent was due, it’s best to create a late fee policy and enforce it. Telling tenants this upfront gently but firmly lets them know You Mean Business™. You can make collecting late fees even easier by setting up auto-late fees.
If you’re dealing with inherited tenants during the pandemic, make sure you proactively reach out to see what their employment status is and explain your pandemic rent policies (i.e., a deferral plan if they’ve recently become unemployed and payment payback policy).
Raising the rent.
While raising the rent might not be possible right now, if you will have to make rent adjustments later to bring the unit up to market value, let the current tenants know an informal heads up before your formal notice.
If you’re raising the rent, you need to give tenants the proper amount of time (typically 30-60 days notice) and document that they received the communication. Using certified mail or email can help with documentation.
Be confident, decent, yet firm.
Inherited tenants are typically scared when a new landlord takes over. Even if you need to immediately set up pandemic rent policies later raise the rent, or move tenants to an M2M, this doesn’t make you the villain. The more clear and upfront you are with your policies, how they’re enforced, and why you’re enforcing them, the better it will be for your future landlord-tenant relationship.