Who covers the cost of your rental property damages

With renting a property comes inevitable damages that you will have to address. Sometimes damages occur as the property ages, while others occur due to negligence on your part or your tenant’s part. Excessive damages can easily cost you thousands of dollars, so you should understand the best practices for dealing with damages.

Who covers the cost of damage repairs?

You, the landlord, should cover anything that affects the dwelling’s habitability. For example, you should never stick your tenants with the bill for things like leaks, electricity fixes, or structural issues that are caused by your negligence or the passing of time. However, you can make your tenants pay if you can prove that the damage was caused by the tenant’s negligence or irresponsibility. In this case, the damage must go beyond what is considered normal wear and tear. Any damage that could not be reasonably expected can be considered going beyond typical wear and tear.

If you try to put the cost on your tenant when the damage is actually a result of your negligence and not theirs, your tenants can take you to court and will most likely win. You should be able to prove that any damage you charge a tenant for occurred as a result of the tenant’s actions (or inaction).

What repairs are normal and what are excessive?

As mentioned above, normal damage that is part of a property’s expected wear and tear cannot be charged to the tenant. Understand the different state guidelines that you will have to follow when deciding what will be deducted from the security deposit to cover excessive damage in order to avoid a lawsuit. If you are unsure about something, always err on the side of caution and cover the charges yourself.

In general, normal wear and tear includes things that you can expect to replace or repair after each tenant moves out. Excessive damages beyond normal wear and tear are things that you cannot reasonably expect to happen and/or things that do not occur naturally as time passes. You may find upon move out that a previous tenant has caused excessive damage because of their negligence; for example, a tenant may cause excessive hardwood floor damage and staining by failing to clean up spills quickly. Excessive damage can also be caused on purpose by your tenants, such as burning holes in the carpet with cigarettes. You can reasonably make your tenants pay for this damage since it goes beyond what you expected to pay for.

Repairing Damages for Current Tenants

To cover yourself legally, you should include language in every rental agreement that specifies what happens when the tenants cause damage beyond normal wear and tear. Make it clear that the price to cover excessive damages will be deducted from their security deposit. In addition, include a provision that states that you will chose who will make the repairs and the replacements so that tenants do not try to find a “cheaper” option.

This does not mean, however, that you can select the most expensive option to make repairs; most laws require that you charge tenants “reasonable rates” for any repairs or replacements. Therefore, you should keep what you charge your tenants competitive, so that they cannot try to dispute the amount in court.

In order to minimize extreme damage, you should also make sure that your tenants know what to do if they need maintenance and repairs when they are still residing on your property. A tenant should never be scared to report repairs to you because the sooner they are fixed, the more money you will save in the long run. Implement a clear process that your tenants can follow to report requests for maintenance and repairs. This process will ensure that you can fix any damages that arise as soon as possible and keep them from turning into nightmares. Explain the maintenance request process to every tenant upon move in and give them the emergency and non-emergency contact information they should use.

Make sure that you properly document any maintenance or repair request in writing in order to protect yourself from any lawsuit. To streamline the process, simply make all requests be submitted in writing. You can have your tenants fill out a written paper or use an online form. If, for any reason, your tenant does make a request over the phone or in person, you should immediately document the request, the date, and the time in writing and keep it for your records.

In the case of both emergency and non-emergency damages, you should give your tenants a time estimate for when the repairs will be completed. Give your tenants this time estimate in writing and keep a copy for your records, should the tenant try to claim you left damages unattended for an unreasonable amount of time. Emergency damages, such as broken locks or plumbing should be addressed within 24 hours or sooner, while non-emergency damages should be addressed within 48 hours.

Once you have addressed the damages, require your tenants to sign off on a dated statement that proves that the repairs have been completed. Again, this documentation will be necessary should you get dragged into a lawsuit. To further protect yourself, require the person performing the repairs to also sign a dated document that states that the repairs have been completed.

Along with the maintenance request process, you should also explain to your tenants during move in what maintenance they are responsible for and what you will be responsible for. For example, explain that your tenants will have to change any burnt out light bulbs themselves, but you will fix any electricity wiring problems. Clearly state these different responsibilities in the rental agreement, so the tenants have documentation to refer to.

How to legally protect yourself

1. If the damage occurs when the tenant is still living on the property:

You are legally required to fix damages that effect your property’s habitability even if the tenant caused the damage. Damages that may make a property inhabitable include things such as plumbing and heat problems, broken appliances that you have provided, structural issues, extended lack of hot water, serious leaks, clogged toilets, gas smells, and broken locks and windows. Although you must fix these problems immediately, you can deduct the cost of repairs from the tenant’s security deposit if you can prove that it was caused by the tenant.

Even if the tenant is the one who has caused the damage, you must make the repairs in order to avoid serious financial and legal consequences. For example, your tenant can withhold or garnish the rent until the problem is fixed, which will obviously hurt your revenue. The tenant may also choose to hire an outside party to perform the repairs if you have ignored the problem; the tenant can then legally deduct the cost of repairs from their next rent check. Lastly, the tenant may report you to the local housing authorities for violating building and/or health codes. If an inspector responds to the report and finds that you are in violation of any laws, you will be required to immediately fix the problem and pay various fines for breaking the law.

On top of the financial repercussions of ignoring damage, you are also legally accountable for damage that goes ignored. Failing to fix repairs will likely violate your tenant’s rental agreement, which will give them enough reason to move out and end the agreement. You may also find yourself in a constructive eviction lawsuit and be required to pay damages to the tenant. Therefore, it is important that you never ignore a maintenance request, so that you protect yourself both legally and financially.

2. If the damage is found after the tenant moves out:

If you find yourself in the situation where a previous tenant has caused damage beyond normal wear and tear, you will have to tread carefully to ensure that they cannot successfully sue you. The best way to protect yourself is to document everything related to the condition of the property. Collect before and after photos so that you can easily compare if anything has changed; you can use this as proof that the tenant did, in fact, cause excessive damage to the property.

In addition to the photos, document your property’s condition before and after move in and move out by using a written checklist. Go through the property yourself before a new tenant moves in and fill out a condition of the property checklist; when the tenant moves out, complete the same checklist to determine if any deductions need to be made. This document will also be valuable evidence if a tenant tries to contest any security deposit deductions.

Remember that the law only covers security deposit deductions if they are used to cover damages that the tenant caused beyond expected wear and tear. For example, if you try to charge tenants for the cost of steam cleaning the carpets, they can contest these deductions in small claims court and probably win. Be conscious of the law and conservative with your deductions so that you get the money you need without getting yourself in legal hot water.

Leave a Reply

Your email address will not be published. Required fields are marked *

Did you like the article? Subscribe to our mailing list to receive a weekly newsletter with our new articles and real estate investment updates. You can unsubscribe at any moment. And we will never sell your contact information.

* indicates required

Related Posts