How to deal with late payments

Question

Hi .

One of my teanent just keeps asking to pay later than the 3rd.

This is her second time she asked for.

Although I have a $50 late fee plus $10 per day, she agreed and paid it all.

Now she is asking for 16th, and I charged her $50+$10 per day, and she accepted.

Should I let it be like this, or do I have to report to her credit?

Thoughts?

Nathan Gesner · Answer

If you allow her to pay later, do you think she will eventually improve and get on track? The answer is no. If she's struggling to pay rent now, there's a very good chance she will only get worse over time and it will eventually create big problems for you and possibly cost you a month of rent or more. By accepting the late rent, you're training her that your rules are negotiable.

She can't manage her finances. If it were me, I would tell her she needs to figure it out and get on track starting in July or she needs to find a more affordable place to live before she ends up falling behind and being evicted. I would try to reason with her and get her to leave. If she insists on staying, then I would follow your process and not waiver on late fees, 3-day Pay or Quits, Eviction, or whatever your process is.

If you don't have a process, it's time to build one. Mine:

- Rent is due on the first day of the month

-Late fee is applied on the fifth day of the month, no acceptions. Late fee is 5% of the monthly rent. I don't increase it daily because (a) that causes confusion, and (b) it may not stand up in court, and (c) I move to the next step quickly

- 3-day Pay or Quit served on the tenth day of the month

- After 3-day expires, I file in court for eviction

By having a process and sticking with it, Tenants know I'm serious and they respond accordingly. When you are negotiable, wishy-washy, or uncertain, then Tenants recognize that and they'll figure out how to play you like a cheap fiddle.

Bruce Woodruff · Answer

There you have it! ^^^

Corby Goade · Answer

Nathan nailed it- these situations don't get better, they get worse.

Think of it this way- what is the purpose of having your tenant sign a lease if you aren't going to play by those rules? The lease is there for a reason, use it.

Best of luck!

Chris Merchant · Answer

That is up to you completely, the one bit of advice I can give is, NEVER accept a partial payment, as far as if you should report to the credit agencies that is up to you.  I would maybe give her a chance to see if she is going to start paying on time or continually wanting to pay late, it seems the late fee does not encourage her to pay on time.  Maybe notify her the next time she requests an extension that being the 3rd time she has made such request in a short time period you may report to the credit agencies.  Though before doing so I would maybe seek legal advice and check local laws especially if there is nothing in your lease about reporting to the credit agencies.

How to deal with late payments

Most Popular Reply