If it looks like a snake and sounds like a snake, it probably is a snake.

While I rarely see a tenant that has a great credit report, the tenants that have problems paying their rent on-time (or ever) have typically shown a history of financial and/or rental problems on their background checks. The ones that have several items in collections especially seem to have issues with rent. I guess paying late and/or not paying an account is in some ways like criminal activity or drugs, once you get past your first time, it just gets easier each subsequent time to not think about the consequences!

Lose a month of rent or have bad debt because of an eviction-which is worse?

Although I am not a fan of having a vacant rental unit and losing a month’s worth of rent, I believe that is an easier one time event than having to constantly call and hunt down your tenant for your rent. Plus, when you have a tenant that is bad at paying, each month you are also wondering if you are going to see the rent or if this will be the month you need to evict.

Realizing and admitting you have a problem is the first step in solving it. I am committed to demanding better tenants. Here are a couple things I am going to do differently:

Explain to the rental agent the exact profile of tenant that I expect.

Have an excellent understanding of the tenants personal circumstances with as many details as possible.

If they have a history of late payments or outstanding payments, run the other way.

Ask for additional damage deposit if I feel like taking a risk on the person.

Sticking to the rule that the prospective tenant must make at least 3 times the rent in documented gross income per month.

Commit to doing a more thorough background check via phone calls to previous landlords and employers.

Not accepting incomplete tenant applications or missing data.

I have been successful up until this point, but I want to improve my investment portfolio and strengthen my cash flow by reducing my non-paying tenants. I also want to reduce my work and stress load by having tenants that always pay on time.