Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
I have a great tenant , 23 year old guy . Just texted me telling me he wont have the rent on time . He has a car payment and rent and doesnt have enough for both . I have to believe his excuse . He is in the Coast Guard . They are part of the Gov shut down. He is never late , he called to let me know , and he keeps the place spotless . I told him I will work with him . It goes against all rules of landlording , but he is a good kid he has always been straight with me .
Fort Polk, LA · Member since 2018 · 41 posts · 47 votes
7y
@Matthew Paul
I knew coast guard wasn't in the department of defense, but I didn't think their pay would be affected by the shutdown.
Army is still getting paid, i think coast guard is department of homeland security.
That's one thing I can agree with you on and would do the same in that spot.
Rental Property Investor · Portland OR · Member since 2018 · 2k+ posts · 3k+ votes
7y
Hey good for you. The govt shutdown is going to bring hard choices for some.
I hope most landlords will be able to handle the late rents this month.
i have worked with tenants in the past. Life happens, you know? So if a tenant calls me and lets me know in advance, I work with them. Win/win in my book
Investor · Vancouver, WA · Member since 2013 · 3k+ posts · 4k+ votes
7y
Great! We allow one late rent "oops" per tenancy (which the tenants don't know until it happens). We take this moment to demonstrate we have a human heart, but also talk about what we would need to do if it happened again (enforce the terms of the rental agreement and charge a late fee.) It does help us establish and maintain a good landlord-tenant relationship. Extenuating circumstances that are out of the control of the tenant also take special consideration. We aim for long-term tenancies and that's what we have!
Fort Polk, LA · Member since 2018 · 41 posts · 47 votes
7y
@Matthew Paul
I knew coast guard wasn't in the department of defense, but I didn't think their pay would be affected by the shutdown.
Army is still getting paid, i think coast guard is department of homeland security.
That's one thing I can agree with you on and would do the same in that spot.
I am not surprised he chose the car ahead of rent.
Of course I would be pi**ed for him choosing a car payment over rent. His priorities are all wrong, there is no way he would lose the car for one late payment. I would take it personally that he "chose" to stiff me. There was nothing extenuating that forced him to make the car payment ahead of rent. It was his choice and it was the wrong choice.
Of course I would not tell him that and I would definatly work with him but I would never forget. Some day he my regret that decision.
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
7y
@Dan R. I double checked and the USCG gets the short end of the stick . I have called some friends that are retired military and they said if the kid needs help they are available to keep his head above water .
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
7y
@Thomas S. I am not pissed at all about the car payment . Why ? I have a 23 year old tenant in the service with a 775 credit score who is a great tenant . I know I will get paid . And I know what its like to be 23 years old . I wont ding his credit . I also have friends and family that are military .
Fort Polk, LA · Member since 2018 · 41 posts · 47 votes
7y
@Matthew Paul
All I can say is wow.
Even though they've never not paid me, the shutdowns have made me cement my decision to not rely on the government for pay. Hence BiggerPockets.
My issue is not about trusting to be paid. It is the slap in the face that he values his relationship with his loan officer more than he values you. The hit to his credit would have been insignificant if the late payment was even reported.
He stiffed you rather than a faceless loan company, but you feel good about it and that's all that matters. Tis better to give than to receive.
Like I said I would go with it and not say anything but I also go with my gut sometimes and my gut tells me clearly where I would stand with this tenant going forward. His poor decision clarified his landlord tenant relationship.
New Haven, CT · Member since 2013 · 222 posts · 134 votes
7y
I understand that we're dealing with a young man that's stuck in a situation that's beyond his control. But a good business practice as a landlord is to never let your tenant's problems become your problems. I know that sounds heartless but you MUST keep it professional and treat him the same way that you'd treat any/everybody else. If one of your other tenants was faced with the same dilemma (their boss doesn't pay them for one reason or another), would you let them slide? If not, you may even be setting yourself up for possible fair housing violations if the other tenant is a different race/gender/religion etc. (Regardless if discrimination is your actual intent or not)
In Connecticut, we can't charge a late fee until the 11th of the month. I charge a $100 late fee on the 11th, and $10 every day after that until the rent is paid in full (regardless of the reason/excuse of why it's late). The main reason that I stick to this is that I want to be priority. If it comes down to paying rent, or paying some other bill, I want it to be very clear that it's better to pay rent first.
Rental Property Investor · Ankeny, IA · Member since 2017 · 2k+ posts · 3k+ votes
7y
@Matthew Paul
You’ll always have some people say to never make an exception. But you run your business how you see fit. The govt shutdown is absolutely an anomaly. And, if somebody chooses to fix their car over paying rent, it’s probably a wise decision. Why? Many times, no car means not going to work means not getting paid and maybe fired. Fixing car means getting to work, making money, and catching up on rent. Obviously, if it happens 2, 3, 4 times, that tenant has to go. If it wasn’t for people not saving money and not living paycheck to paycheck, they would buy and you wouldn’t have tenants.
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
7y
@Cameron Norfleet I get what you are saying . And I dont let the tenants problems become mine . And I generally dont take excuses . But when I have a great tenant who is a young man serving our country calls me beforehand and explains the situation , and its not BS , I did make a business decision based on the circumstances . And I get to defer some income from this year ( he pays early always ) His rent is $1200 , not a big deal to wait , my kids will still get fed . I have the higher end class c and middle class b properties .
I have another tenant who is going thru a nasty divorce . He is putting out a lot of money . His father has covered his rent twice this year . But the guy is experienced in home improvement . He has a side business with insurance . So to help him and help myself , I have sold some jobs and subbed them out to him . I make money off the job AND I get the rent . A third tenant is a mechanic who moved from out of state , he found a job but wasnt making what he is worth , I made a few phone calls and hooked him up with one of the better shops in the area making almost double . He pays like clockwork now .
I like to stack the deck in my favor when possible .
Like with my coast guard guy , I hooked him up with my mechanic and towing company since he was new to the area . He appreciated it . And he has asked if I had any other vacant houses because he has other guys at the yard that want a nicer place .
Investor · Chicago, IL · Member since 2009 · 1k+ posts · 1k+ votes
7y
Just because someone is late with the rent, should not mean you go straight to eviction. If someone communicates the situation, then you work with them. Don't let the tenant train you to pay routinely at the end of the month.
Investor · Richmond, VA · Member since 2013 · 347 posts · 191 votes
7y
One of the things I enjoy about being a landlord is that I get to make my own rules. So when the situation warrants a granting some slack we get to do that. I've never been good at the "I'm just the manager, not the owner" pose. So my tenants know that I own the property and I set the rules. Sometimes this works in my favor since I'm not just a "corporate" entity that they feel OK with stiffing vs. a "real" person. When people get into a bind what do we expect them to do? Number one in my book is communication. In my experience the people who have turned out to not deserve the extra break are the folks who do not communicate. So I really value the people who come forward with info and let me know what's going on. In the long run I have found that they can be the most loyal and ultimately dependable. There's no guarantee, but do what you feel is right.
Rental Property Investor · Erie, PA · Member since 2018 · 6k+ posts · 9k+ votes
7y
What was the purpose of your post ? I think most would agree considering his character and history that It’s one of those things in life that is a hiccup to overlook for a month while things get in order .. however what happens if it goes on for three more months and you don’t get paid but his car payments do ? Now you got a situation that you must make tough decisions on . I for one believe we needed this shutdown to happen to get our much needed security in this country on track but to each his own .
I understand that we're dealing with a young man that's stuck in a situation that's beyond his control. But a good business practice as a landlord is to never let your tenant's problems become your problems. I know that sounds heartless but you MUST keep it professional and treat him the same way that you'd treat any/everybody else. If one of your other tenants was faced with the same dilemma (their boss doesn't pay them for one reason or another), would you let them slide? If not, you may even be setting yourself up for possible fair housing violations if the other tenant is a different race/gender/religion etc. (Regardless if discrimination is your actual intent or not)
In Connecticut, we can't charge a late fee until the 11th of the month. I charge a $100 late fee on the 11th, and $10 every day after that until the rent is paid in full (regardless of the reason/excuse of why it's late). The main reason that I stick to this is that I want to be priority. If it comes down to paying rent, or paying some other bill, I want it to be very clear that it's better to pay rent first.
I am not surprised he chose the car ahead of rent.
The conventional wisdom is people will lose their car before they lose the roof over their head (rent or mortgage payment). The aftermath of the Financial Crisis of 2008 proved this to be true (in a manner of speaking). According to the San Jose Mercury news, people started living out of their cars when they had to choose between rent or car payment. The City of San Jose has restrictions on living out of your car and how long you can park your car in any one place on the street. These displaced people (some single parents with children) knew how long they could stay someplace (usually a day or two) before they had to move to a different parking space. Landlords might not want to rent to these people, but these former tenants (or homeowners) made the logical choice from their point of view.
Investor · Boise, ID · Member since 2014 · 3k+ posts · 3k+ votes
7y
I respect your willingness to work with your tenant and his situation. If he's been great, respectful and it's a one time deal, I'd charge him a late fee and thank him for being up front with me.
On the other hand, I've had tenants that aren't so great where the same scenario was ongoing. Yes, their priorities are backwards- why would you make a car payment before your rent payment when you could pick between not having a car and being homeless? They only make that choice when you have not trained them properly and likely not acted professionally- I've been there. I did have to evict a tenant once who gave me that same line of BS month after month, while refusing to pay a late payment, but they were always on time with their car payment.
I respect your willingness to work with your tenant and his situation. If he's been great, respectful and it's a one time deal, I'd charge him a late fee and thank him for being up front with me.
Best of luck- I hope it works in your favor.
Who knows if it will be 1 month , 2 month or 6 months . I will deal with it as I go . I guess it all depends when one political party cries uncle . Since we arent suppose to dive into the political arena , I will leave it there .
It is unfortunate that this situation seems primarily driven by emotions but that is most often the case with small time landlords, those having only a couple of tenants. They usually fail to see the bigger picture beyond the immediate issue. They themselves will usually make excuses for the tenant to help themselves feel better about their business decisions. It's there business and in most cases the money is secondary to them being perceived as being a nice person/landlord isn't it.
As a landlord with a large number of tenants that depend on me making the proper business decisions to maintain the health of my business I do not make emotion based decisions. It simply does not help my business or my other tenants to do so.
In this situation there is little beyond enforcing the late fees at this point in time but I would be sitting down with this tenant and making it crystal clear as to what my expectations will be for the immediate future and make it very clear that it is never to happen again.
Step one would obviously be to ask as to how much he can pay immediately toward his rent Jan 1. Step two would be to discuss his possible sources of money to make the remainder of the rent quickly. His family and friends need to be supportive of him at this time as opposed to him using his landlord as a loan company. And finally he would need to be instructed on the importance of not having ZERO savings which places him in dire straights at the loss of only two weeks pay. I am guessing that is in fact not the case, he very likely does have his rent, but is choosing to hold it in reserve knowing his landlord really has no say in his decision. His landlord is being played but that is unimportant.
Going forward if this tennat can not be turned around very quickly he would be too high risk to retain as a tenant. His landlord can not remain as his pay day loan company every time he has a unexpected expense. Unfortunately following this situation his tenant will likely not understand that fact. It worked for him once why would it not work again after all the landlord has plenty of extra money doesn't he.
Severna Park, MD · Member since 2013 · 7k+ posts · 7k+ votes
7y
@Thomas S. I dont have emotison , I am a guy . I dont let tenants take advantage of situations . My best tenants have been military . Never had a problem . sure the kid should have had some savings . But I was 23 years old for about 10 years ( had to stop sometime) . He is stationed here for 2 more years . The political party at fault could cave in in a short time or a long time . And since he isnt even late yet , and he called be ahead of time to let me know . Since he is military , and this situation is not his fault nor could be anticipated , I will work with him to different degrees as time progresses
Good for you. I see to many quick trigger heartless responses on late rent. You can always serve a five day notice. A good tenant who always pays on time with a legitimate reason to request for more time is reasonable. A car payment being late will go against his credit while rent will not unless you report to the credit bureaus. Having compassion for people is an attribute not a hinderance. We all have needed help at some point in our lives. Not a hand out just time.