Trading rent for service can lead to major problems. For example, suppose you need to have some bushes trimmed and one of your tenants volunteers to do the job in exchange for a one-time rent reduction of $50.
This is all verbal. Your tenant promises to trim the bushes and haul the clippings to the city’s refuse disposal area. He or she has their own ladder and hedge trimmers and will use their own vehicle for hauling. Sounds harmless enough, right?
What happens if you don’t think your tenant has done a satisfactory job? Are they still entitled to the $50 credit?
If you believe the work performed is only worthy of a $25 credit and they take the full $50 credit of their next month’s rent, would you be able to serve them with a three day notice to pay rent or quit for the remaining $25 you believe is still due? And suppose that while they trimmed the bushes, there was a slip and fall incident, or a traffic accident while on their way to the dump? Of course, this is what insurance is for, but what if your worker’s comp policy won’t cover it? The next time you might be tempted to trade rent for services, be sure to consider the risks involved and the problems it could cause.