What to do when tenants aren't paying

Question

Let's say the bubble does burst and the housing market takes a turn for the worse. I want to know what everyones solution is to tenants not being able to pay or if you have an exit strategy?

Patricia Steiner · Answer

The first thing to do when you're not paid rent is to send a Notice To Quit/Cure.  It's the first step in the eviction process but even more important, it's documentation that you have demanded payment after a default.  You can go through the eviction process and I recommend doing it early on rather than waiting a month or two to do it. Don't accept any partial payments as that will be considered a cure by the court.

As an alternative to eviction, file a Small Claims lawsuit for the amount due using the Notice of Quit as documentation along with the lease.  It's inexpensive to file and in most municipalities it can be done online. Get your judgement to ensure that you get paid before those folks can get a new apartment, car, phone, and more.

Have strategies in your tool box ready to go.  Manage to the lease.  And, act.  Those who wait, lose.

Best...

Ian Huber · Answer

Like most things in life its probably a case by case basis.  If they've previously been a strong tenant, working with them to help them on their way or until they are back on their feet may be more effective than eviction.  Being in California if the S hits the fan again I wouldn't expect very friendly eviction proceedings.