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Mac and Kelly Radner are a young couple with a newborn daughter. The restrictions of parenthood make it difficult for them to maintain their old lifestyle, which alienates them from their friends Jimmy Blevins and his ex-wife, Paula. One day, the couple finds out that Delta Psi Beta, a fraternity known for their outrageous parties, has moved into an adjacent house. The fraternity's leaders, Teddy Sanders and Pete Regazolli, aspire to join Delta Psi's Hall of Fame by throwing a massive end-of-the-year party.
One night, the couple ask Teddy to keep the noise down. Teddy agrees on the condition that Mac and Kelly always call him instead of calling the police. To earn Mac and Kelly's favor, Teddy invites them to join the party, which the couple agree to. At the party, Kelly meets Teddy's girlfriend, Brooke Shy, and Teddy shows Mac his bedroom, which includes a stash of fireworks and a breaker box that controls their power.
The following night, Mac is unable to get in touch with Teddy to ask him to keep it down. Kelly convinces Mac to call the police, but Officer Watkins identifies them to Teddy. The following day, Delta Psi constantly hazes Mac and Kelly. The couple goes to the college dean, Carol Gladstone, and learn that the school has a three strikes policy; burning down their old house was Delta Psi's first strike.
After failing to force the emphasis to move by damaging their house, Kelly manipulates Pete and Brooke into having sex and Mac gets Teddy to catch them. Teddy and Pete fight, which ends with a barbecue grill being rolled into the path of a passing car and injuring a professor, giving Delta Psi their second strike. To acquire evidence of Delta Psi's hazing schemes, Assjuice stands up to Teddy to record him threatening retaliation. When Teddy instead shows him kindness, he reveals that Mac and Kelly hired him to spy on the fraternity, and also damaged their house. Teddy begins playing violent pranks on the couple.