How Are You Handling Non Paying Tenants ?
Member since 2020 · 21 posts · 10 votes
BP,
I have a couple tenants I can't evict during COVID who haven't paid in quite some time. What is your approach? How are you handling it?
Thanks!
~Caleb
@John Underwood, @Shane C., @Theresa Harris
Thank you all for your responses. The moratorium in Florida does not end until Sept. 1st.
Theresa, did you set up a payment plan for them? Also, are you threatening eviction right off the bat or are you just letting the lease end and not renewing in hopes that you will be able to get some money out of them. With low income rentals I know that if I evict them then I'm not going to see any money at all.
Thanks all.
~Caleb
I'm not in FL so take this with a grain of salt. When the shelter in place really started to become a reality we went ALL IN on customer service to solidify the relationship prior to the (inevitable) stickiness that was to come.
Anyway, we checked in with all tenants every other week thanking them for paying, reminding them we are a small business and their payment (even if just partial) was really helpful, helped several file for unemployment, and offered to pick up rent so they didn't have to come to the office. We reminded them all late fees and NSF fees would be waived. We also (after getting permission from our property owners) took an extra step and told our tenants that if their financial position became burdensome, if they could communicate that with 30 days notice we'd allow them to terminate their lease and retail their security deposit. Mostly, we let them know that we were here to help them.
I only say all that to say, most of our tenants were so grateful to have communication from us that they reciprocated. They'd make partial payments, pick up extra jobs, communicate proactively if they wouldn't be able to pay, and/or voluntarily move out. We only had a single eviction to file (out of 140) when the moratorium lifted. We had 2 (if I remember correctly) voluntarily move out and left the property in good shape. We have ~10 who are still a bit behind on rent.
Anyway- it put us in a really great spot on the eviction we had to file because we were able to show overwhelming support of our tenants. We had the ruling immediately and moved right along.
Tenants are people. They want respect, compassion, and to know their options. :)
I just filed an eviction and I know tenant is in process of packing.
I just had to fill out an additional form that said this house did not receive any government assistance such as section 8.
Why can’t you evict them? There is no federal moratorium any longer for non-payment of rent, unless you have one on a state or local level. This could change at any time, so I’d be filing if I were you.
If there is no ban, give them an eviction notice. I have one who isn't paying and the ban lifts in that area on Sept 1. They've been told they have to pay Sept 1 or they will be evicted. For the 2 months they missed, they have 10 months starting Oct 1 to pay it back (took the amount and divided by 10)...again failure to pay the regular rent and back rent, will result in an eviction. This is what the province set out and they are tenant friendly.
@John Underwood, @Shane C., @Theresa Harris
Thank you all for your responses. The moratorium in Florida does not end until Sept. 1st.
Theresa, did you set up a payment plan for them? Also, are you threatening eviction right off the bat or are you just letting the lease end and not renewing in hopes that you will be able to get some money out of them. With low income rentals I know that if I evict them then I'm not going to see any money at all.
Thanks all.
~Caleb
@John Underwood, @Shane C., @Theresa Harris
Thank you all for your responses. The moratorium in Florida does not end until Sept. 1st.
Theresa, did you set up a payment plan for them? Also, are you threatening eviction right off the bat or are you just letting the lease end and not renewing in hopes that you will be able to get some money out of them. With low income rentals I know that if I evict them then I'm not going to see any money at all.
Thanks all.
~Caleb
I'm not in FL so take this with a grain of salt. When the shelter in place really started to become a reality we went ALL IN on customer service to solidify the relationship prior to the (inevitable) stickiness that was to come.
Anyway, we checked in with all tenants every other week thanking them for paying, reminding them we are a small business and their payment (even if just partial) was really helpful, helped several file for unemployment, and offered to pick up rent so they didn't have to come to the office. We reminded them all late fees and NSF fees would be waived. We also (after getting permission from our property owners) took an extra step and told our tenants that if their financial position became burdensome, if they could communicate that with 30 days notice we'd allow them to terminate their lease and retail their security deposit. Mostly, we let them know that we were here to help them.
I only say all that to say, most of our tenants were so grateful to have communication from us that they reciprocated. They'd make partial payments, pick up extra jobs, communicate proactively if they wouldn't be able to pay, and/or voluntarily move out. We only had a single eviction to file (out of 140) when the moratorium lifted. We had 2 (if I remember correctly) voluntarily move out and left the property in good shape. We have ~10 who are still a bit behind on rent.
Anyway- it put us in a really great spot on the eviction we had to file because we were able to show overwhelming support of our tenants. We had the ruling immediately and moved right along.
Tenants are people. They want respect, compassion, and to know their options. :)
@John Caleb Pavlus For this tenant, we tried to talk to them once they missed July's rent and they didn't show (or didn't answer their door). Plus they didn't reply to emails and blocked the phone. So I used what the province mandated for the payment plan and stuck to it. I also told them rent for Sept is due Sept 1 and if it isn't paid in full, we will evict them. Then for Oct -July inclusive, they have to pay the regular rent along with the back rent and utilities (total amount for July and Aug divided by 10-for 10 monthly payments) and told them that starting Oct 1, they have to pay the regular rent plus $X extra to cover back rent and utilities or they will be evicted.
Had this been someone who hadn't blocked off communication, we'd have just talked through it, but with this person, I am putting it in writing and added the eviction part. I emailed them and put the note on the door on the 14th to give them time to either move (and said they could do that before Sept 1) or figure out payments. I now have it in writing from them that they are staying and will follow the payment plan. I have eviction notices ready to go for Sept 2 (where I am rent has to be paid on the 1st and there is no grace period) should I need them.
I only say all that to say, most of our tenants were so grateful to have communication from us that they reciprocated. They'd make partial payments, pick up extra jobs, communicate proactively if they wouldn't be able to pay, and/or voluntarily move out. We only had a single eviction to file (out of 140) when the moratorium lifted. We had 2 (if I remember correctly) voluntarily move out and left the property in good shape. We have ~10 who are still a bit behind on rent.
Anyway- it put us in a really great spot on the eviction we had to file because we were able to show overwhelming support of our tenants. We had the ruling immediately and moved right along.
Tenants are people. They want respect, compassion, and to know their options. :)
They are people and most of mine are great. I didn't contact mine other than the one who was always behind on rent and told them to let us know if there was a problem....then they couldn't pay rent (and were getting $2K a month from the govt and had access to another $500 to help with rent) and cut off communication. For that one we tried and clearly they didn't want to communicate, so at that point it became a business transaction and if they don't pay for Sept (when the ban is lifted), I will file an eviction.
@Alyssa Dyer Hello I appreciate your compassion towards the tenants. I like your way of how you are doing your business. I am new here but have 2 houses under contract but I would want to approach this business with empathy and compassion for my tenants also.
Sharing this so other landlords may benefit - posted in the how to evict section as well. We had a slow paying tenant here in Minnesota - late 80% of the time from the get go - stop paying rent in June. We tried negotiating, payment plan, nothing worked. They blamed Covid although there were 3 out of 4 working adults in the house (4br) with 2 adult kids. When we sent them a written notice to leave after a month of non-payment the tenant actually called the Atty Generals office. We decided on a variant of cash for keys. Presented them with 3 options on Monday - (1) pay $1,000 by Friday and get on a payment plan (we had already waived all late fees) or (2) continue to refuse to pay and we go after you in small claims court (served them at the same time) or (3) move out in two weeks and we cancel the lawsuit. They chose #3. They played the game well and caused us to lose $$$ - we get to keep their deposit against the rent which helped offset 1/2 of it. I post this here to let you know there are options even when you can’t evict. Had these tenants lost their jobs from Covid we would have worked with them, but they were simply taking advantage of us and blaming the situation.
@John Caleb Pavlus I think a lot of tenants have been misinformed about not paying rent. It’s going to be a rude awakening when the courts start opening back up and hard for them to catch up on back rent.
While dealing with these cases can be extremely stressful, it’s important to approach the situation as calmly as possible. Treat your tenants respectfully, but don’t be afraid to communicate and enforce the rules as outlined by your lease agreement.
@Alyssa Dyer, @James Mcsweeney, @Jaquetta T Ragland, @Theresa Harris, @Alex Corbishley
All -Thank you for your responses. Apologies for my delayed response.
Now that the moratorium is federal have any of you seen any aid for us who own rental properties - Will there be any federal assistance (money) where the government pays us back for the tenants who didn't pay (and won't pay) their rent during COVID?
Thank you!
~Caleb
@Alyssa Dyer, @James Mcsweeney, @Jaquetta T Ragland, @Theresa Harris, @Alex Corbishley
All -Thank you for your responses. Apologies for my delayed response.
Now that the moratorium is federal have any of you seen any aid for us who own rental properties - Will there be any federal assistance (money) where the government pays us back for the tenants who didn't pay (and won't pay) their rent during COVID? Thank you! ~Caleb
Not all people are covered by the eviction moratorium
It's important to read what it covers and what it DOESN'T cover:
Here is the Actual Wording:
“Covered person” means any tenant, lessee, or resident of a residential property who provides to their landlord, the owner of the residential property, or other person with a legal right to pursue eviction or a possessory action,
a declaration under penalty of perjury indicating that: (See Page 9)
Lots of luck applying all your tenants' rules and oaths. Virtually, nobody cares about lying when under oath. Bad people lie and the courts do nothing. A landlord makes an innocent mistake and the court always favors the tenant and frequently throws a case out leaving the landlord to re-start the entire eviction process.
It is an expectation that a very high percent of non-paying tenants will file bankruptcy, stay several more months while landlords are evicting them and the courts cannot force tenants to pay. If tenants could hardly pay rents before the virus then don't expect tenants to magically get jobs that paid more than before the virus.
Set realistic expectations regarding the collecting of your overdue rents and the courts won't do jack for you. Expect court date for evictions to be several months out.
You may as well just make believe you are generous and wipe out tenants' debts.
Am I am optimist, or WHAT?
I have two tenants who are not paying and I know for a fact they could find a job, but why should they when they don't have to pay rent as long as they don't have a job. Does it make any sense? One tenant can live in my apartment for the rest of her life without working. Her electric bill is small and she has a son who gives her plenty of money to eat. So, she stays in my apartment for free watching television. We have the most generous government in the world when it comes to our money, but you can expect our governments will continue raising taxes, fees and they will not give discounts like they force landlords to do.
@John Caleb Pavlus I'm in Canada and we can now evict and are doing that one tenant who no surprise changed her mind. I'll be out 3 months rent by the time she's gone. I'm hoping she's out soon as she's had the moving van there since at least Sunday (yes Aug 30) and it is packed. She's sitting in the empty house dragging this out (yes I have an email where she literally says this). Pretty sure there are mental health issues, but she has support and will hopefully be out in the next week. She apparently has no money for rent, but can order take out, alcohol, pay for a moving van and other stuff. We hauled away 6 bags of garbage (they weren't properly closed hence we saw some of what was in there, plus we wanted to make sure it was garbage) that she had sitting in the back yard for a few weeks (maggots everywhere) because she was too lazy to bring it to the curb on garbage day.
I only say all that to say, most of our tenants were so grateful to have communication from us that they reciprocated. They'd make partial payments, pick up extra jobs, communicate proactively if they wouldn't be able to pay, and/or voluntarily move out. We only had a single eviction to file (out of 140) when the moratorium lifted. We had 2 (if I remember correctly) voluntarily move out and left the property in good shape. We have ~10 who are still a bit behind on rent.
Anyway- it put us in a really great spot on the eviction we had to file because we were able to show overwhelming support of our tenants. We had the ruling immediately and moved right along.
Tenants are people. They want respect, compassion, and to know their options. :)
They are people and most of mine are great. I didn't contact mine other than the one who was always behind on rent and told them to let us know if there was a problem....then they couldn't pay rent (and were getting $2K a month from the govt and had access to another $500 to help with rent) and cut off communication. For that one we tried and clearly they didn't want to communicate, so at that point it became a business transaction and if they don't pay for Sept (when the ban is lifted), I will file an eviction.
Heard that! It's like the tenant of mine who called us back in March and asked if he still had to pay rent with COVID. He's on disability + Section 8, just looking to pocket the money. I'm all about remembering people but end of the day it's still business.
@Alyssa Dyer Hello I appreciate your compassion towards the tenants. I like your way of how you are doing your business. I am new here but have 2 houses under contract but I would want to approach this business with empathy and compassion for my tenants also.
I appreciate it. It's not always feasible, but man, it's a whole lot easier when we can interact how we prefer.
@Alyssa Dyer, @James Mcsweeney, @Jaquetta T Ragland, @Theresa Harris, @Alex Corbishley
All -Thank you for your responses. Apologies for my delayed response.
Now that the moratorium is federal have any of you seen any aid for us who own rental properties - Will there be any federal assistance (money) where the government pays us back for the tenants who didn't pay (and won't pay) their rent during COVID?
Thank you!
~Caleb
It looks like the guys have a ton of the logistics and black&white answers worked out below.
We're operating with the assumption minimal/no relief is coming for landlords, but are optimistic that won't be the case.
Honestly, our main goal is just "playing the game" with the tenants who we know will use the system. We're fine losing a month or so of rent to get rid of the worst case people before regulations cinch up too tightly. For the tenants still working and communicating, we're thrilled to work with them.
I only say all that to say, most of our tenants were so grateful to have communication from us that they reciprocated. They'd make partial payments, pick up extra jobs, communicate proactively if they wouldn't be able to pay, and/or voluntarily move out. We only had a single eviction to file (out of 140) when the moratorium lifted. We had 2 (if I remember correctly) voluntarily move out and left the property in good shape. We have ~10 who are still a bit behind on rent.
Anyway- it put us in a really great spot on the eviction we had to file because we were able to show overwhelming support of our tenants. We had the ruling immediately and moved right along.
Tenants are people. They want respect, compassion, and to know their options. :)
They are people and most of mine are great. I didn't contact mine other than the one who was always behind on rent and told them to let us know if there was a problem....then they couldn't pay rent (and were getting $2K a month from the govt and had access to another $500 to help with rent) and cut off communication. For that one we tried and clearly they didn't want to communicate, so at that point it became a business transaction and if they don't pay for Sept (when the ban is lifted), I will file an eviction.
Heard that! It's like the tenant of mine who called us back in March and asked if he still had to pay rent with COVID. He's on disability + Section 8, just looking to pocket the money. I'm all about remembering people but end of the day it's still business.
Exactly. As you said in another post, I'm just playing the game with this one tenant.
What they don't understand is that Landlords are still required to pay their mortgages, property taxes and other expenses related to the leased properties. There should be a financial provision for us too!
@Theresa Harris did you use any legal forms or contract to allow partial payments or repayment?
One of my tenants just gave the notice they are struggling and would like the opportunity t onmake partial payment and a way to repay later.
@Theresa Harris did you use any legal forms or contract to allow partial payments or repayment?
One of my tenants just gave the notice they are struggling and would like the opportunity t onmake partial payment and a way to repay later.
I didn't as this one wasn't going to pay and had her friends there who made a mess of the place.
As you have good tenants, just write up a document that you both sign with the terms and both get a copy. Ask how much they are paying, if they want to pay it once a month ($500) or do two payments ($300 each) per month for whatever length of time you are going to allow. You might get more of the rent if you do two payments per month. Then figure out a repayment plan for the balance. Where my rental is, the govt said tenants had 10 months to pay outstanding rent-take the amount, divide by ten and add it to the rent.
@Theresa Harris did you use any legal forms or contract to allow partial payments or repayment?
One of my tenants just gave the notice they are struggling and would like the opportunity t onmake partial payment and a way to repay later.
I didn't as this one wasn't going to pay and had her friends there who made a mess of the place.
As you have good tenants, just write up a document that you both sign with the terms and both get a copy. Ask how much they are paying, if they want to pay it once a month ($500) or do two payments ($300 each) per month for whatever length of time you are going to allow. You might get more of the rent if you do two payments per month. Then figure out a repayment plan for the balance. Where my rental is, the govt said tenants had 10 months to pay outstanding rent-take the amount, divide by ten and add it to the rent.
Theresa, Thanks a lot for you input, I will definitely implement your suggestions