Bad tenants are, unfortunately, part of the business of running an investment property. Whether short-term or long-term renters, you won’t like them all, and some people out there are serial scam artists who know how to game the system. All businesses have to deal with folks that make them want to tear their hair out: airlines get whiny passengers, hospitals get abusive patients, restaurants get hostile patrons, stores get shoplifters, and just about every business in the world has an unwarranted negative Google review. It happens when you run a business, even if you run it well. And owning rental properties is a business.

The best remedy for dealing with bad tenants is to do everything you can upfront to prevent bad tenants in the first place. For long-term rental properties, this means doing a thorough background check and obtaining a copy of their driver’s license before accepting their application. Do not skip these steps. It is far better to have another couple weeks of vacancy than to get yourself into a landlord-tenant relationship with a deadbeat. Companies like TransUnion and other similar companies allow you to run a background check with the tenant’s permission relatively cheaply. You can’t see everything, but you can get a sense of their credit worthiness, eviction history, and red flags in their criminal background check. If a person has trouble paying their credit card or their utilities, they are going to have trouble paying their rent. Do not get desperate for a tenant. It’s important to get their driver’s license because you will need information like their birthdate and last known address if you eventually need to try to collect back payments from them through the court.

For short-term renters, beware of scams where people ask for things like a very long rental period at an odd time of the year where it sounds too good to be true. This can be a scam because they will make the payment, then request a refund, and you will end up getting charged the refund even though the original payment eventually bounces. To protect against this, set your Air BnB or VRBO account to require people to ask permission to book rather than booking automatically. Once someone requests to book, checkout their profile. See if they have a long history on the platform and positive reviews. If their profile is brand new, beware of scams, or perhaps they needed to start a new account due to previous bad reviews. If your spidey senses go off about someone for any reason, just shoot them a friendly message to get more information: “Hi _____! I saw your request to book. I’m glad you’re planning a trip to _____! Can I ask what brings you to the area and how many people will be part of your stay?” If they don’t reply, reject their request. If they don’t give you a warm fuzzy, you can also consider rejecting their request. Some our best short-term tenants have surprised us though. A bachelor party ended up being the most lovely group of professionals who cooked and enjoyed three low-key evenings on the deck at our lake cottage. Obviously, you can’t discriminate against anyone, so keep your evaluation of people focused on the facts and the trustworthiness of their profile history and personal responses to your messages.

If you do have a non-payer in a long-term rental, you need to have a provision for this in your rental agreement. And, most importantly, stick to it. If the rent is overdue, send a notice to them of “pay or vacate,” or whatever the first step is in the pre-eviction process in your location. A notice to pay or vacate does not mean they are going to be evicted but puts them on notice that you are not running a free hotel. If the person has a very legitimate reason that you trust to not send this type of formal letter, then use your judgment as to whether or not you are going to extend a short grace period, but be aware that extending a grace period once means that they will likely ask again.

If you have someone who has not paid and is giving you the runaround about when and if they’re going to pay, it’s best to move to the formal eviction process. Research the laws in your area. Often, evictions can take a LONG time, and the person will almost certainly stop paying any rent during the process. So don’t wait to get it started. Many attorneys who handle evictions do so at a very reasonable rate, so don’t hesitate to reach out to some local attorneys to ask for a quote for their services. You can also offer the tenant “cash for keys” where you actually pay them or forgive their overdue payment in exchange for them leaving the property. Again, check on the laws in your local area, but if this option is allowed where your property is, it can save you a ton of time, headache, and expense of having a non-paying tenant in there when you could have a better, paying tenant in there instead. Whatever you do, don’t change the locks on the person . . . the eviction process, as slow as it is, is the way to get a person to leave the property legally.

For short-term rental guests who overstay, contact the local police for trespassing. Short-term rental guests do not have the same rights as long-term tenants because it is not their home. You can also contact Air BnB or VRBO for assistance. You can ask the police what your options are for getting the people off your property as soon as possible.

Don’t let fear of evictions and non-paying tenants stop you from investing in real estate. There are costs associated with running any business. In real estate, repairs, improvements, vacancies, and sometimes evictions are part of the cost of doing business. But if you’re running your business right and have chosen a good investment, the financial benefits of owning real estate will far outweigh the costs. If for some reason you’re ready to get out, there is always the option of selling, so you are almost never truly stuck with a losing proposition.