5 Ways to Deal With Bad Tenants in Metro Detroit

Being a landlord in Metro Detroit comes with its fair share of challenges, and one of the most frustrating aspects is dealing with problem tenants. While eviction is always an option, it’s important to recognize that it can be a long, costly, and stressful process. This is why many landlords look for alternative ways to handle difficult tenants that can help resolve issues without going through the formal eviction process.

The key to successfully managing problem tenants is to approach the situation proactively and consider solutions that prioritize communication and compromise. Open and honest discussions can sometimes lead to mutual agreements that benefit both parties, such as creating a new payment plan for overdue rent or addressing specific behavior issues through written notices or lease amendments.

Other strategies include offering incentives for better behavior or even negotiating an early lease termination, which allows tenants to move out on their own terms without facing eviction. In some cases, it might be worth hiring a property management company or consulting with a real estate attorney who can provide professional guidance and help navigate tricky situations.

The goal is to resolve issues in a way that minimizes disruption and costs, while maintaining a professional landlord-tenant relationship. By taking a strategic approach and exploring all possible options, you can handle difficult tenants effectively and avoid the drawn-out, expensive process of eviction.

Below, you’ll find 5 ways to deal with bad tenants in Metro Detroit in order to avoid having to have recourse to eviction.

1. Tenants Who Won’t Pay

A common category of bad tenants in Metro Detroit is those who just won’t pay their rent. And this, of course, will adversely affect your cash flow.

The thing to keep in mind is that tenants don’t pay for a variety of reasons, and often it’s not out of malice or an intention to defraud you. Industry experts note that tenants can withhold rent due to a number of factors, including cash flow shortages, temporary unemployment, or disputes over repair and maintenance issues. Open communication is essential when addressing these situations. It’s important to approach the issue with understanding and to try to negotiate a solution if possible.

As a landlord, there are a few strategies you can use to help resolve this problem and make the financial situation more manageable for your tenants:

1. Set Up a Payment Plan: This can make it easier for your tenants to catch up on their rent over time without the added stress of paying in full. You could:

• Implement a policy that allows partial payments, such as accepting one partial payment per year.
• Prorate late fees and delinquent rent over the remaining term of the lease to reduce the immediate financial burden.
• Allow tenants to make weekly payments instead of larger monthly installments.

1. Use the Security Deposit: In some cases, applying the security deposit toward delinquent rent payments might be an option. This could provide immediate relief for the tenant while also ensuring that you’re recouping part of the unpaid rent. However, keep in mind that this could leave you without the funds needed for potential damages when the tenant eventually moves out.
2. Adjust Living Arrangements: If your tenant can no longer afford the rent, consider working with them to find a solution that better fits their financial situation. This might include:

• Setting them up with roommates to share the cost of living.
• Moving them to a smaller, more affordable unit within your property portfolio.

Approaching the situation with empathy and flexibility not only helps maintain a good landlord-tenant relationship but can also result in a better outcome for both parties. Open dialogue, patience, and a willingness to work with your tenant can go a long way in finding an amicable resolution.

2. Tenants Having Problems With Other Tenants

And then there are those who are bad tenants in Metro Detroit because they are too loud or just obnoxious. Despite your best screening efforts, this kind of tenant can still slip through and can problems for you and other tenants.

The first step in handling problem tenants is to encourage them to resolve any disputes or issues on their own. One way to do this is by including a clause in the lease agreement that explicitly states that tenants are expected to make every reasonable effort to settle disagreements without involving the landlord. This clause could also include a reminder that if the landlord does need to intervene, the outcome might not be favorable for all parties, and one tenant could end up unhappy or even move out.

However, there may come a point when you need to step in and mediate the situation. If that happens, it’s crucial to remain neutral and approach the matter in a calm and measured way. You can help the tenants understand that the consequences of their disagreements ultimately impact them, not you, as the landlord. Emphasize that your role is to facilitate a resolution, not to take sides.

It’s also important to ensure that your lease or rental agreement includes clear property rules and regulations, along with provisions that outline how disputes between tenants will be handled. Having these clauses in place can help you manage tenant conflicts more effectively, as it sets expectations upfront and provides a framework for addressing problems as they arise.

3. Tenants Who Pay Late

Some tenants do pay, but they always pay late – not withholding payment, but just late. In dealing with these bad tenants in Metro Detroit, it’s wise to keep in mind that the reason for late rent payments may be fairly innocent, something like mere forgetfulness. 

Meeting with tenants to discuss their situation and understand why their rent is consistently late can be a proactive approach. By having an open and honest conversation, you can uncover any underlying issues they might be facing and work together to find a solution. For example, you could agree to waive late fees and other penalties if they commit to paying any overdue rent in full moving forward. This gesture can go a long way in building trust and encouraging tenants to stay on track with their payments.

Another effective strategy is to send payment reminders. While it may require some extra time and effort, setting up reminders—whether through text, email, or phone calls—can help tenants stay aware of upcoming due dates and make it easier for them to budget for their rent. This simple step can prevent misunderstandings and reinforce the importance of timely payments.

4. Don’t Renew the Lease

When the methods outlined above for dealing with bad tenants in Metro Detroit don’t produce results, you still may not have to resort to eviction.

Refusing to renew a tenant’s lease is an option, but it’s important to handle this process carefully and in accordance with local regulations. If you choose this route, ensure you understand the tenant protection laws in your state or city, as they can vary significantly. Typically, landlords are required to provide written notice to tenants informing them that their lease will not be renewed once it expires.

The amount of notice you must give can depend on where you are located, with common timeframes ranging from 30 to 90 days. This means you need to check your specific state and local laws to comply properly. Keep in mind that while this option may help resolve rent payment issues in the long term, it isn’t an instant solution and may require time for the tenant to find alternative living arrangements.

Before proceeding, it’s wise to communicate respectfully with the tenant and, if possible, work out a mutually agreeable timeline that allows them time to move without facing sudden displacement.

5. Consider a “Cash for Keys” Agreement

Another last-resort solution, short of eviction, for dealing with bad tenants in Metro Detroit is the “cash for keys” agreement. It will cost you, but it will also get a bad tenant out of your hair and solve the problem. “A cash for keys agreement is a legally binding contract, whereby you pay a tenant a lump sum of money, and their lease is canceled, and they have to move out of your property.”

You might be asking yourself why you would consider paying a problematic tenant to move out. The reason is simple: it can make good financial sense in the long run.

Evicting a tenant can be both expensive and time-consuming. The process can easily cost $5,000 or more and take several months to complete. On the other hand, offering a tenant cash to leave voluntarily—often referred to as “cash for keys”—can be a cost-effective solution. If you can pay, say, $1,000, and the tenant agrees to move out within a week, you can save a significant amount of money and avoid the lengthy court proceedings.

This approach also means you can start renting your property to a more qualified tenant sooner, minimizing vacancy time and potentially improving your rental income. In many cases, paying a tenant to move out can be a win-win, helping you regain control of your property without the added expense and delay of formal eviction.

But Be Careful . . . 

Whatever method you choose to deploy in dealing with bad tenants, make sure you’re aware of all the legal ramifications and implications. Tenant-protection laws are far broader than they were just a few years ago. Your best bet is to consult an experienced Metro Detroit investor to get help understanding exactly what you can and can’t do as a landlord. So for assistance dealing with bad tenants in Metro Detroit, contact us today at (313) 246-4551.