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We see everyday in more than one business, that customers can turn bad. It’s not unique to property investing. It is a fact of life, just the way it is. But one can avoid big problems if you know what you are looking for and the turn around if identified early enough.
Consider this, investors gets bonds for investment properties, then
investors can run into financial problems. For whatever reason the investor couldn't pay the bond and the bank decides to repossess the property. Not nice, nonetheless, that
is reality in some cases and even the best customers can turn into bad
customers in a bad market due to unfortunate circumstances. For the bank a non-paying customer is a bad
customer, just as a non-paying tenant is a bad customer to a property
investor.
For the property investor, a non-paying tenant is a bad tenant,
though as in our example that may have initially been a good tenant
that due to unfortunate circumstances has turned into what property
investors call a “bad tenant”. That does not make the person a “bad”
person, but a problem tenant to the landlord or a problem customer to
the bank in our bond example.
So yes, good paying tenants can turn into non-paying tenants. What
you need is ways to identify changes that indicate problems. Here are a few instances that you
may be able to easily identify:
- The tenants is avoiding you.
- Each month the rental is further delayed.
- The tenant complains about things that are not really a major
problem and has never complained before about them (take for example a
tenant that starts complaining about the neighbors dog, but has never
done this before and has been living in your property for months).
- The tenant complains about things he or she knows you have no
power to fix nor did they complain about this before (like the dog
example).
- The tenant more frequently starts mentioning problems that he or she has.
All of the above, and much more, are indications that there is a
problem. It does not matter what it is – it matters that it is identified
early and solved. The tenant may be trying to find a way out or is
in trouble and you may end up with a non-paying tenant.
These situations are easily identifiable early and must be dealt
with swiftly before the issues turn into a major
problem that will be much harder to fix.
In letting there are some very important, and often forgotten and
unknown little tricks that can help you let your properties easier and
with far less hassle than what most people experience. So in the next
post we will give a few simple but very effective Tips and Tricks.
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