Inside T&H: Lease Management and Enforcement

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Usually, when you think of what a Property Management company does, the first things that likely come to mind are collecting rent, handling maintenance issues, conducting move-ins, and other notable events.

And, clearly, those are are important functions. 

But, you may not even realize all of the smaller, in-between tasks that come with the job.

The tasks associated with managing and enforcing the terms of our Lease make up a big part of what we do for you as a rental property owner.

The key, obviously, to managing this minutiae comes down to a strong Lease. To use a cliche… the devil is in the details.

A strong Lease not only sets expectations and standards for the Tenant, but it protects you and your asset.

And even with a strong Lease, you must have the systems and resources in place to enforce it.

So, today, we’re going to discuss a few ways we do this for you.

Lease Violations

Lease violations are any incidents or situations where the Tenant does not adhere to the terms of the lease.

Some of the more common Lease violations we see are:

  • Unauthorized pets
  • Unauthorized occupants
  • Not properly taking care of the yard i.e. mowing

Between our Property Managers, Maintenance Technicians, Vendors and neighbors, we have a lot of eyes on the lookout for any Lease violations that may occur. Obviously, we don’t have video cameras installed throughout the property, but we work hard to catch any issues quickly to mitigate risk and harm for our Owner Clients.

If a Lease violation is reported, we will promptly send a notice to the Tenant clearly stating what the violation is and what Clause of the Lease the action violates.

In addition, we provide a resolution action, along with the date to cure the violation. If applicable, we also charge the Tenant’s ledger with appropriate fees which are outlined in the Lease.

If the Tenant does not provide proof that the violation has been resolved in the time allotted, we will send a Property Manager to inspect the situation. The Tenant will then be charged for the PM’s trip as well as the applicable violation fee.stop-sign-35069_1280

Depending on what the issue is, if the Tenant STILL does not resolve the violation, we will typically charge them additional fees, resolve the issue ourselves at the Tenant’s expense, or in some rare cases, an eviction filing may be necessary.

In most cases, once Tenants are notified that a violation has occurred, they are quick to resolve the issue. 

However, in some cases, further “urging” is required. 

As you may have guessed, with the volume of homes that we manage, we deal with Lease violations on a weekly basis.

It’s part of what we do, and we’ve developed some very effective systems to deal with them. 


Fairly regularly, we receive requests from Tenants to amend their Lease.

For example, if a Tenant decides to get a dog a few months into their tenancy,  and the property is deemed to be pet friendly, we will send out an Amendment for both parties to sign.

Having this signed documentation is very important and ensures everyone is on the same page should any issues arise down the road.

Other common Amendments include painting, additional occupants, short-term Lease extensions, satellite dishes installation, etc. 

Like Lease violations, we deal with Amendments almost every week. 


Lease Breaks

While it doesn’t happen on a weekly basis, unfortunately there are instances when a Tenant may want or need to break their Lease.

The reasons are probably obvious… job transfer, they decided to buy a house, divorce, etc.

If a Tenant reaches out and lets us know they would like to break their lease (which must be done 30 days in advance of when they would like to move), we will send an Amendment to the Tenant to sign.

Once the amendment is signed, the Tenant will be instructed to pay the Lease Break Fee which is equal to 3 months rent. These funds will be deposited to your account, less management fees, during the next scheduled Owner Draw.

Once the funds are paid, we will immediately begin marketing the home to minimize vacancy.

The Tenant is responsible for all rents, utilities, landscaping, etc. until the end of the 30-day notice.


The Daily Grind of Property Management

As you can hopefully see, there’s a lot to effectively managing a rental property.

In some cases, everything goes smoothly, the Tenant pays rent on time, adheres to the Lease, and doesn’t ask for any special accommodations. 

However, when special circumstances arise, it’s critical to have the right people and processes in place to effectively deal with these situations. 

About the Author

Jeremy Tallman

Jeremy is the Chief Executive Officer and Managing Broker for T&H Realty Services. He has been active in the Central Indiana real estate market since 2000 and leads one of the most successful single-family property management companies in the state.

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