A repair deductible that is in a rental lease basically says that the tenant will pay the first $___ (fill in the blank) in repairs for anything that goes wrong in the house. After that deductible amount, the owner will pay the rest. There are different schools of thought on repair deductibles. For the owner, it could be good because for small repairs, it becomes the tenant’s responsibility. But is it really good for the owner?
Tenants don’t like this clause and feel the owner should take care of any problems. As a result, sometimes small problems can be overlooked or neglected because the tenant doesn’t want to spend the money to pay to fix the problem. If that happens, a small problem can turn into a much bigger problem and in the end will cost the owner a lot more money than if they had taken care of the problem in the early stages. Not all tenants will neglect problems, of course, but the majority of tenants we speak with do not like having to pay a deductible.
In the leases we use in our property management company, we do not have repair deductibles for the tenants because of the issue mentioned above. We work hard to be proactive and keep in touch with tenants and handle problems as early as we can. We certainly don’t want to spend our owner’s money if we don’t have to but we’d rather see them pay $79 for a service call than potentially thousands down the road.
Have you had experience with repair deductibles whether you are an owner or tenant? Comment and let us know!