From 0-20 units in 6 months

3 Replies

Hello BP

I am a new investor who has purchased 21 units in the last 6 months

4 family

4 family

8 family

2 family

2 family

Single family

My question is existing tenants. I live in Missouri and I have 3-4 tenants who are late in rent every single month almost letting the rent go into the next month.

They all say they got a new job ect

I’m not afraid to evict people I just was wondering if there is a scary letter I can send out before paying an attorney hundreds each time to file the eviction? Would anyone care to send me what they send tenants who are late or don’t pay within a certain amount of days.

Also after how many days do you actually file? What is your process before you evict ?

I would go according the lease and wait until the 15th of the month to start handing out notices. Once they know your lenient they will take advantage of you

We have used this form in the past - https://bit.ly/2qzaHkk

Basically, the fact that you are sending them a letter at all will usually give them a wakeup call. Anyone who has not paid by the 5th gets a letter and we usually state that we will file after 10 additional days. Most of the time people communicate with us and we are somewhat flexible if the person has (i) an established history of paying and (ii) a legitimate reason (e.g., temporary work stoppage, death in the household, etc.). 

When we evict, we generally go through the entire process even if they pay. In our state, you can file the eviction and it will be valid for a period of months. That way they are still allowed to live in the property as long as they are on top of the payments going forward, but we won't have to go through the long process again to get them out if they fail to do so. 

For people who are late every month, make sure you are charging late fees and enforcing them. Ours are generally 10% of the rent and can make up for receiving the rent late. We have a few residents who routinely pay late fees and it just becomes extra money on our end. Those who are smart will avoid late fees and pay on time, but the point is that late fees can only help you. 

Congrats on the progress you are making!

My policy is:

  1. Rent due in full on or before the 1st;
  2. Late fee applied on the 5th;
  3. Only accept money orders or cashiers checks on the 5th or later because I need to know the money is good;
  4. If not paid in full by the 10th, file a 3-day Pay or Quit;
  5. If not paid in full by end of 3-day, file for eviction
  6. Eviction hearing is within 7 - 14 days of filing;
  7. Evict

You have tenants that have been improperly "trained". Someone has allowed them to pay late without penalty and they no longer see this as a professional business transaction. I can assure you their cell phone, cable bill, and car payments are no this lax.

There's no magic formula but this is usually fixed with a short, professional reminder of the policies spelled out in the lease agreement. Let them know you intend to enforce them 100% for all residents, no exceptions. You will stick to the deadines, you will not waive late fees, and you will start the eviction process without failure.

Then you have to follow through consistently. A letter like this may scare them into compliance for a month or two but you have to be vigilant about enforcement every single month, even six months down the road.