It’s that time of the month again.
You expect to receive the typical payment from your renters, but this time, it’s different.
Or, maybe this time it’s just like last month, and the month before that.
Your tenant can’t pay rent or refuses to pay it. As the landlord, you’re suddenly in the middle of an uncomfortable and complicated situation. You can’t exactly go in there and pack his bags for him. Plus, eviction can be time-consuming and expensive. What other kinds of recourse do you have?
Read on to learn a few small, easy steps that could help you avoid the hassle of taking more drastic measures.
1. Consider Why the Tenant Can’t Pay Rent
It’s one thing if your tenant misses his rent payment for months on end. Yet, it’s another if this is the very first time it’s happened.
While you might be upset about the missed payment, it’s not the best time to break down his door and demand your money. A more sensitive and respectful approach would be to start by sending a friendly written reminder. If your lease agreement defines terms for a late fee, you can detail those steps therein.
2. Pay the Tenant a Visit
A cold shoulder won’t get you very far, here. To collect payment and assess the situation, you’ll often need to visit the tenant in person or at least over the phone. It’s best to perform this step as soon as possible before more time lapses.
When you do, you’ll have one mission in mind: Figure out why he missed his rent payment.
Did something recently happen in his life that might have a negative effect on his finances? For instance, did he just lose his job or experience a personal loss? Or, maybe he just forgot the payment or misunderstood the late-fee policy.
Regardless of the explanation, you don’t have to allow him to continue living in your property rent-free. However, you might be more sympathetic to the situation and less prone to respond in anger. Once you’ve heard his side of the story, calmly explain that rent must be paid on time.
The key here? Try to remain calm and understanding, but be as firm as possible. You don’t need to be disrespectful or crude, but you also don’t want to be seen as a pushover. You need to make it very clear that missed payments shouldn’t become a habit.
3. Issue an Official Notice
Did your in-person meeting leave you with more questions and controversy, but no rent money? If so, your next step is to issue an official Pay or Quit Notice.
Legal in most states, this notice is simply a document issued to the delinquent tenant as soon as his rent becomes past due. More formal than your initial letter, this one details clearly how much rent is due, as well as any late fees incurred. It also sets a firm deadline for payment before legal recourse is taken.
While some jurisdictions will require you to deliver the Pay or Quit Notice in person, others will let you mail it. While it’s tempting to scratch ASAP in bright red ink under “Payment Deadline”, it’s important to understand that most states require a grace period of three to five business days.
Not sure about the local laws and regulations regarding landlord/tenant policies where you live? An experienced lawyer for landlords can answer all of your questions and set you down the right path.
4. Pay the Tenant to Leave
If all of the above fail and you’re left with a tenant who simply refuses to pay, you’re essentially losing money by the day. Remember: Your goal is to make that property work for you.
While it might cost you a little, you might want to consider actually paying the existing tenant to move out and find somewhere else to live. The money you’ll lose at this step can easily be recouped (and then some) once a more reliable renter moves in.
One caveat? The property must be in good shape if you decide to go this route. You don’t want to give someone money, ask them to leave town, and find that the place is totally trashed and unlivable.
5. Pursue Eviction
Your final step if you have a tenant not paying rent? If nothing else seems like a viable option, it’s time to initiate an official eviction. While you might be ready to cut off the power to the property to send an immediate signal, it’s important to follow the appropriate legal actions.
Depending on where you live, eviction could be a simple or all-consuming step. In almost every case, you’ll be involved in a lengthy court process. That’s another reason why it pays to have an experienced landlord attorney on your side. You can even hire an eviction lawyer who has specialized experienced in this exact field.
Throughout the proceedings, try to remain as calm as possible. Even if you’re irate with the renter, there’s no need to add a potential harassment lawsuit on top of the already-messy situation. If the law falls on your side and you win the eviction case, your local law enforcement officials can help you evict the tenant.
Real Estate Advice You Can Trust
As a landlord, you know the ins and outs of real estate can be a challenge to navigate. In addition to legal specificities, there are also maintenance concerns, financial considerations and yes, the occasional tenant who can’t pay rent.
It can be difficult to keep up with it all, so that’s why we’re here.
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