My Tenant Messaged Me and Asked for 2 Weeks Extension

My Tenant Messaged Me and Asked for 2 Weeks Extension

Lowell, MA · Member since 2014 · 335 posts · 52 votes

My BP Landlord Community,

One of my tenants messaged me and told me that she won’t be able to pay her rent on the due date. She will need two weeks extension. She sounded very confident as she had done something like this before.

She told me her husbands lost his job and just found a new one. She said that her car did not have a plate and had cost her an arm/leg for it.

My wife told me to send in the written notice to start the paper trail. I told her that to give the tenant a week – in my stomach I know that when the one week came around I won’t see the money.

I can smell this tenant and I think she is going to be the trouble one with rent due issue.

Ideally, I can start the eviction process immediately with 1 day late in MA, because we don’t have a grace period. She is a TAW with a small baby. I don’t charge her late fee, because MA is not allowed to.

Should I tell her to move on if she is late again next month?

She was late last month too – 5 days

In general, I am a passive and aggressive. I let thing slight here and there, then I bite on it aggressively when it reaches a certain point.

Do you have any thought? Let's here it.

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Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
12y

When a tenant tells *you* when they'll pay the rent, you can be fairly certain they won't. Clearly, paying the rent isn't their priority - getting a license plate is. We evicted a tenant last month that had this outlook. She was late several times, paid the late fees (allowed in FL), and finally got to the point where she didn't pay at all. She gave 2 future dates that came and went, and we filed after the 2nd one...and she again gave us another date that she would pay. She was evicted in a month.

Right now we have a tenant that hasn't paid this month, here in NJ. She's been late several times before, always paid the late fees, and has been a good tenant so I let it go until last week. She claimed her bank account was compromised and a loved one was in the hospital. The attorney is filing the Pay or Quit tomorrow and will follow with the eviction.

If tenants believe there are no consequences to paying late, they will always pay on their own schedule, and in your case, you can't even collect late fees. We've gotten 3 new tenants in the last 6 months, and each one was told upon lease signing that the rent is due on the 1st, and the Pay or Quit will be served on the 3rd. No exceptions. They can borrow the money from friends or relatives.

I don't know what TAW is (rental assistance?). Is she on a month to month? If so, give her the 30 day notice or whatever is required and/or file the Pay or Quit. Paying rent when it's due is not a choice; it's a legal obligation.

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  • Investor · Vancouver, WA · Member since 2013 · 3k+ posts · 4k+ votes
    12y

    If the tenant has not paid anything to you by the middle of the month, how will they have the money for the next month? Ask the tenant to get the money from family, friends, lenders or by selling something. Tell them it is no longer an option for them to pay late. Get what you can from them now and then serve the Pay Late or Quit notice for the difference. Do what you need to do and move on. I often tell tenants "You need to pay to stay. If you don't, then you will need to move out." Don't let them go past the 15th of this month. In the future, address it sooner.

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    The tenant was told last week to pay at least half the rent and late fees; she did not respond and did not pay. She still has her job and has usually paid on time, or at least within a week with the late fees. She'll have to figure out herself how to come up with the money. When they stop communicating, it's usually game over.

  • Lowell, MA · Member since 2014 · 335 posts · 52 votes
    12y

    Hi Everyone,

    Thank you for a very details recommendation. In summary, I need to consult an attorney using network from local real estate or landlord association. Is anyone from around MA and have additional references for the attorney specializes in eviction?

    It sounds like I need to be more aggressive and be on time with them.

    All my tenants pretty much pay on the 6th. They told me this is when they will have the pay check. My wife used to complaint why I let them control the date when we pay our mortgage on the 1st.

    To my surprise I messaged the trouble tenant this morning telling her that I will be dropping off the “14 day notice to quit” and I was apologizing for doing so. She did not response. How’s about that?

    I guess I am happy to spend time and know a forum (biggerpocket) like this exist, where I can learn and improve my investment method and strategy. This is the kind of thing I will never understand – it does not matter how many books/podcast I read and listen to. This is street education.

    -Chan-

  • Investor · Tallahassee, FL · Member since 2014 · 246 posts · 89 votes
    12y
    Originally posted by @Chan K.:

    Hi Everyone,

    Thank you for a very details recommendation. In summary, I need to consult an attorney using network from local real estate or landlord association. Is anyone from around MA and have additional references for the attorney specializes in eviction?

    It sounds like I need to be more aggressive and be on time with them.

    All my tenants pretty much pay on the 6th. They told me this is when they will have the pay check. My wife used to complaint why I let them control the date when we pay our mortgage on the 1st.

    To my surprise I messaged the trouble tenant this morning telling her that I will be dropping off the “14 day notice to quit” and I was apologizing for doing so. She did not response. How’s about that?

    I guess I am happy to spend time and know a forum (biggerpocket) like this exist, where I can learn and improve my investment method and strategy. This is the kind of thing I will never understand – it does not matter how many books/podcast I read and listen to. This is street education.

    -Chan-


    never apologize unless you have failed someone. Kindness can be mistaken for weakness. I have the same passive and aggressive trait, and let me tell you that it takes 1 situation to fix that. This is your situation. You don't have to operate like East Berlin, but in the beginning it would behoove you to exclude the following: emotions apologies(unless where necessary) leniency waivers of penalties count this as a learning experience, get an air tight lease, know the landlord rules as well as your attorney, and enforce everything to a "T". Believe it or not, this situation will actually make you money in the long run(provided you learn and adapt). Keep your head up! Sebastian
  • Bill S.Pro Member
    Moderator
    Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
    12y

    @Chan K. I'm kind of late to this discussion. I too would vote to tighten up your ship. If the tenants can pay on the 6th redo your lease or month to month agreement so that payment is due on the 6th.

    Offer a debiting service (ClearNow or erentpayments) to take rent money from their bank account on the day they are paid. That way they don't get to decide if they are going to drive or pay rent. You get rent. Charge them extra rent if they don't use your debiting service.

    Your PM's advise is bad. Never, ever delay posting notice when rent is late. If it's due the sixth, post the 7th. Site down and figure your per day amount for lost rent. That is what it costs you to wait.

    Listen more to your wife.

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    I use erentpayment.com, and have one (new) tenant paying by auto-debit on the 1st. Most of our other tenants use that service, and get an auto-reminder on the 3rd to pay online. It works great when they intend to pay and have the money in their account - but when they don't, as in the case of the tenant we're evicting now, she used erentpayment.com 4 days after the rent was due....knowing she had no money in her account to cover it. I had told her to pay by direct deposit to my business account at the bank, but she knew by paying online, it would take up to 5 business days for the money to come out of her account.

    And knowing that, she bought herself 5 more days before the rent payment was returned for insufficient funds. Hence, her current eviction filing.

    Going forward, my leases will state that any online rent payment that is returned for NSF will have the online payment option cancelled, and all payments must be made by depositing at the bank. The learning experience never ends.

  • Joel OwensBusiness Member
    Moderator
    Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
    12y

    Chan is this just a SFR house??

    If so at least you do not have to worry about tenants talking to each other. With apartments and multiple units you have to worry about doing the same thing every time or word gets around you went soft on one of them and the late payment to no payment rent starts spreading like a cancer.

    A specialist eviction attorney in your area will know the realities of evicting.

    Some the states investors buy in boggles my mind of 3 to 6 months to get them out. Here in Georgia in most counties it's 30 days filing to their butt being thrown out. When tenants know they are on a short rope they do not try the stuff for the most part like in tenant friendly states.

    To get SCHOOLED on evictions go to the courthouse where the cases are heard and spend a couple of times there. You will learn a ton about the process and it's realities.

  • Bill S.Pro Member
    Moderator
    Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
    12y

    @Aly W. you need to not allow the tenants the option of not debiting from erentpayment. The standing debit authorization (Automated Clearing House or ACH) is the only acceptable rent payment. Rent is taken from the account and no action is required by the tenant. ClearNow is more expensive but ACH is the only method they do so tenants have no wiggle room. With ACH there is also no clawback like with a NSF check. The money is there for the debit or it is not. If it is there, you get the money, if it's not, post notice and go to court.

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    When I first started using erentpayment, I didn't enforce the auto-debit on the 1st. I know some of my tenants get paid every other Friday, which sometimes falls on the 3rd or 4th, and as long as they pay the late fee on that day, it works well. New tenants now don't have that option. It's auto-debited on the 1st, or they can choose to pay on the 1st at TD Bank right into my account. I like having a few tenants that pay that way, as the money is available usually within 24 hours instead of 5 days.

    Do you mean that ClearNow, unlike eRentpayment, will not even deposit money into my account to then wait for an NSF - i.e., the clawback you mention?

  • Lowell, MA · Member since 2014 · 335 posts · 52 votes
    12y

    This thread is pretty good.

    The software uses to collect the monthly rent is pretty advance landlord stuff. There is going to be another thread debating which software is best for certain situation. It seems like we have multiple one going on.

  • Bill S.Pro Member
    Moderator
    Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
    12y

    @Aly W. it's not about the service company (clearnow or erentpayments) as both offer ACH (electronic banking) if you select the correct option from erentpayments. ACH takes the money (debit on a set schedule) and routes it through the banking system to your account. Once you see the money in your account, it's there until you spend it. It's not like a check that you deposit and get credit for but take days to work it's way through the system and then your bank takes back the funds when the check comes back NSF. That's all I meant by clawback.

    If tenants are paying even a few days late you should address this in your next lease. ACH eliminates this as it takes paying rent out of the tenants hands. Get them on the payday payment plan. Work out your lease so that they pay when they have the money and they are never behind. Letting it slide for some can become a nightmare if you end up in court. For example if you granted leniency to one person but not to a member of a protected class it looks bad. It also sets a precedence which can jeopardize you ability to collect late fees in the future.

    PS I know you know this but wanted to make sure it was clear for others.

  • Andrew SyriosPro Member
    Moderator
    Residential Real Estate Investor · Kansas City, MO · Member since 2014 · 10k+ posts · 5k+ votes
    12y

    It's a rare thing when what a tenant says comes true. I usually will offer one strict payment plan, and if they miss that, no more luck. Keep it as close to a policy as possible.

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    Hi @Bill S. , erentpayment did exactly what you described with the rent as if it were a check...they deposited the tenant's ACH payment into my account after 5 days, it cleared through my bank, and then they discovered the insufficient fund issue. The next day, erentpayment debited the money back out of my account. Had I spent it, my account would be overdrawn. When the ACH is initiated, eRentpayment doesn't know if there are actual funds to pay it - that's why it takes 5 days to clear. Or possibly the funds were there when the ACH began, and other debits to the tenant's account cleared first.

    New tenants have no choice but an auto-debit on the 1st, unless they tell me another day and we work out a pro-rated first month's payment. For existing tenants, like this one, she's now lost the option to pay online. If she decides to pay to stop the eviction, she'll have to pay the rent directly into my TD Bank business account on the 1st or whatever day we pro-rate. That way the money is physically in the account and I don't have to wonder if eRentpayment will pull it back 5 or 6 days later.

  • Bill S.Pro Member
    Moderator
    Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
    12y

    @Aly W. I have never used erentpayments but when I looked at their site it "seemed" like they had the same thing as ClearNow but it was sort of tucked away in the corner of their site. I will look at it again. With ClearNow, in the 6 years I have used them I have never had them take money back. In fact, it's my understanding that they take it from the tenant's account, it winds it's way through the banking system and then shows up in my account. It takes 4-7 days depending on holidays. If the account has NSF then I get an email the day before the payment was to be made to my account. I then go after the tenant for the rent and late fees. This is at least 2x faster than when I would know if the tenant wrote me a hot check.

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    I'll take a look at ClearNow. With eRentpayment, the tenant has the legal right, according to them, to stop a payment within 3 days I think it is...and that's exactly what happened once, when a tenant decided to cancel the auto-debit because she believed she had paid the last month's rent when she moved in several years prior. She had not, but was able to cancel the payment after the auto-debit started, but before it was cleared through my bank. Now I know not to spend any cleared ACH rent for at least 2 business days after it's been deposited to my account. With a direct cash deposit, the money is there and they're not getting it back. Unless they don't put it there.

    There's no perfect system it seems ;)

  • Bill S.Pro Member
    Moderator
    Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
    12y

    @Aly W. in reading both sites, the only difference is the ClearNow states the deposits into your account are "always three business days after the debit day." erentpayment is a bit more vague saying 2-3 business days. Seems like they may have messed up in your case and didn't fully verify the funds availability before "depositing" the funds in your account. In reading about the ACH system it appears that the difference maybe in the way ClearNow and erentpayment handle the ACH. Maybe it's not as sure of a thing as I thought.

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    @Bill S. , I just emailed customer service at eRentpayment to see exactly what the process entails after an ACH is initiated from the tenant's account, and when it's considered a safe bet to spend the money that gets deposited.

  • Lowell, MA · Member since 2014 · 335 posts · 52 votes
    12y

    @Aly W. and Bill, after your discussion, can you conclude which system is more desirable? Thanks

  • Rental Property Investor · Annapolis, MD · Member since 2014 · 214 posts · 140 votes
    12y

    Why complicate things guys? I just have my tenants go to our bank BBT and deposit the rent to our account. Most of the time they bring cash and I can start spending it 10 minutes later. It is also free for both of us, for the tenant and for us too! And if I don't see deposit by the 4th they get a text from me and if no response or no pay the 6-7th I go to the courthouse and file for Failure to Pay Rent. (cost only $22) and this will get them a notice and a court date. Which is most of the time is enough to get them pay. If they don't pay than we go for " round two" :)

  • Investor · San Antonio, TX · Member since 2014 · 129 posts · 79 votes
    12y
    Drop the hammer and evict or offer them a few hundred to move out.
  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    @Val Csontos , I do have several tenants regularly paying by directly depositing cash into my business account. The challenge is that if you have multiple tenants with the same rent amount, you don't know who paid or when. So I only allow it for tenants with unique rent amounts.

    From eRentpayment:

    "After the renter submits the payment and we start processing the payment the renter's account is typically debited the next business day after we begin processing the payment, so for example a payment submitted on Monday will debit the renter's account on Tuesday. Per ACH rules the renter's bank has three business days to return the transaction from the time it debits their account, so in this case three business days from Tuesday so the renter's bank has Tuesday, Wednesday, and Thursday to return the payment if necessary. With our system we settle the payment after two business days to get you the funds quicker so there is a possibility the payment could be returned after it goes to your account. Typically the latest a return could occur is the afternoon of the day it deposits, not later. So a good rule is to wait through the afternoon of the day it deposits and if you don't get a return notice you know it is valid and won't be returned NSF."

  • Rental Property Investor · Annapolis, MD · Member since 2014 · 214 posts · 140 votes
    12y

    @Aly W. I hear you about the same amount, we usually ask them to put street name/# next to the name on the deposit slip, AND we just raise the rent by $5 or $10 to make it unique amount. Of course once we reach the 100th tenant I will re-think this method :)

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    I like your plan @Val Csontos ! I think the next tenant's rent will be $1001, the next one $1002, and so on. The sequential rent plan - we have a long way to go before we hit the 100th tenant :)

  • Investor · Fort Lauderdale, FL · Member since 2012 · 1k+ posts · 465 votes
    12y

    The odd number rent amount sounds interesting.

    There was a thread here on BP some time ago someone suggested making purchase offers in odd numbers to make it stand out and seem like the number was the result of some real hard number crunching.

    The only issue with odd numbers is if you have any fees or charges that are percentages of the rent, like late fee being 5% of rent $1002 is hard.

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    I recall that as well @Sam Leon , and will keep it in mind. Our late fee is a flat $50 on the 3rd of the month, then $5 a day after that.

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