We have a tenant who consistently pays late in the month and has refused to pay the late fee. Our lease calls for a $50 late fee if rent is not paid by the 15th of the month (this per our lawyer's suggestion) and our tenant generally pays around the 22nd or 23rd. She owes $200 right now and we don't see her ever paying them. We'd like to evict her. Can we do so just on late fee nonpayment? We're in Colorado. Thank you for your input.
Do you have a deposit and has the house been damaged? That's one avenue once she's gone. Have you ever moved to evict her when she's been late in the past? That would probably be your starting grounds.
You need to take a look and see what your lease says. You will never be able to evict for non payment of late fees. The court will not allow it. However, your lease should spell out how the money is applied every month. It is always applied towards late fees, posting fees. Ours states this:
3.4 APPLICATION OF FUNDS
1. Money paid by Tenant shall be applied in the following order:
A. Maintenance charges due in accordance with the Owner/Owner’s Broker Tenancy Guidelines;
B. Late charges, dishonored check charges, or trip charges;
C. Past due utilities;
D. Unpaid security deposits;
E. Attorney fees, Processor fees, and Court Costs;
F. Past due rent, oldest month to newest;
G. Current rent.
So if rent is $1000 and they Pay $1000 next month. The first $200 would go towards those fees and the balance of $800 towards the rent. Now they owe $200 for rent. You can take that and start the eviction process.
@Tracy Streich Thank you. That's exactly what I needed to know.
How much longer do they have on their lease? Might be easier and less costly just to not renew, and then deduct it from the deposit.
I didn't forget, I just can't imagine any state law that would not allow late fees to be deducted from a deposit. I guess it's conceivable if you live a in a jurisdiction ran by nutballs, like Seattle, but I'd say it's rare
@Kathy Brasby It depends on what your state law says. In Oregon, you can definitely evict for nonpayment of late fees as it falls under "material violation of rental agreement". First time nonpayment of late fees, the tenant gets a 30 day notice of violation of rental agreement with a right to cure. Second violation within 6 months will get 10 day notice for repeat violation but with the second violation there is no right to cure and you can file for eviction after the 10 days. There are of course other technicalities to follow to successfully evict but all the steps are spelled out in the law. Note that the process above is per Oregon landlord/tenant law.
My advice to every landlord I talk to is this: Learn your state's landlord/tenant laws, make sure your lease complies with the law, follow what the lease and law say, be fair but firm when it comes to performance of the terms of your lease.
The tenant is on a month to month lease so we could cancel the lease - and probably will. We run the risk in that scenario that she just doesn’t pay her last month's rent. I need to do more research into this portion of Colorado law. I appreciate all the advice, thanks.
It depends how the fees apply via the lease and most likely if you take it to court she will pay the late fees plus attorney fees. You will sue her and she will remedy the balance. Chances are she won't vacate over this amount of money. That is just what I have seen.
@Kathy Brasby so you are missing some details and as well all know the devil's in the details. In Colorado, to apply rent to late fees, damages, money owed, and etc. your written rental agreement has to spell that out. If it's not in your rental agreement the court won't allow it.
So a little tough love here. If rent is late on the 15th, the tenant should get a notice to pay or quit on the 16th. If they haven't paid by the opening of court on the 20th you file. Once you file you do not have to accept rent and they must move out or be evicted. When is rent due? If rent is due on the 1st why in the world do you allow them until the 15th to pay? You know they will wait. There is no requirement for a grace period of any kind in Colorado.
So moving forward this is what I would do. If your rental agreement does not have the add a clause stating how funds received are applied. You are on a month to month agreement. Issue them an addendum to that affect which would take place starting the next rent cycle.
Get rid of any grace period. Rent is due on the last day of the month and late if not in your bank account on the 1st. Get a debiting service to collect your rent for you if they have a bank account. No more chasing rent or waiting for the tenant to get around to dropping off a check. If they don't have a bank account make them post it to your bank account. Make the necessary changes to your rental agreement to require this.
Next time the tenant is even one day late post a 3 day notice to pay or quit. File an eviction on the 4th day if they don't pay in full. If you accept partial payment you have to start over and repost the 3 day notice.
You get what you stand for. You have allowed the tenant to pay late so they pay late.
Now for a strategy to get the rent owed. I'm guessing from your post they have not paid Sept rent. Chase them hard between now and Oct 1. Hopefully they will pay. If they don't pay file for eviction on Oct 3. Don't threaten just be persistent. If they pay (make sure the check is good), give notice that Oct is their last month. If they don't pay Oct rent file the 1st day you can (remember you have a 15 day grace period). You will likely lose a month's rent but it's highly unlikely that your tenant will catch up. They have been getting later and later. My guess is they get paid weekly or every two weeks and have gotten a bit behind with other bills and your rent is just not a priority for them.
You might try offering a payday payment plan where you divide the rent over their pay periods and have them pay rent each payday. It makes collections easier.
@Bill S. Thank you. A little tough love is necessary in this business. We do property management and this particular landlord has a soft heart. He's resisted our efforts to tighten up collections. However, you've made very good points and we will be incorporating them. There's always something new to learn in this business. Thank you.