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So how would you handle this type of tenant
Quick question . . . our leases state that the rent is late if not paid by the 3rd of the month and at 15 days, we will initiate eviction proceedings. We have one tenant that screened well (talked to the previous landlord and no issues were communicated) who has been in the unit for 5 months now. The first three were paid promptly and then December rolled around. No payment by the 3rd, no communication and then we were notified that the tenant had deposited a portion of the rent in our bank account. We sent another invoice with the late fee and received a text - not a call - saying that their mother had been ill. We tried calling and no answer. The rent was finally paid on the 15th.
Fast forward to January and the issues start all over. Nothing paid until a portion was deposited on the 6th, no communication, not taking calls and again, paid the rent with late fee on the 15th.
How would you deal with the tenant on the rent payment situation?
Thanks
Reiterate the terms of the lease and consult an eviction attorney. If the same thing happens in February, you can send a 5 day demand letter (or whatever your lease says) and if still nothing you could either consider cash for keys or move forward with eviction. When does their lease expire?
#4 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
- Investor
- Austin, TX
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#4 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
- Investor
- Austin, TX
Let them pay late with all the late fees. If they reach the eviction threshold be prepared to do so.
#1 Tenant Screening Contributor
- Property Manager
- Honolulu, HI
Aloha,
It would really depend on whether I was operating a Business, or a Charity. As a Business, I would follow the terms of the rental agreement and local law.
Quote from @Richard F.:
Aloha,
It would really depend on whether I was operating a Business, or a Charity. As a Business, I would follow the terms of the rental agreement and local law.
Understand . . . . the lease specifies the 3rd and the 15th and the tenant pushes the 15th before legal action is started. We are having a meeting with them this week and seek to understand what their intentions are and if this will be a regular occurrence. They have 6 months left on the lease so I guess we simply take the late fee each month and do not renew. Posted this because other than the isolated "bad luck" other tenants may have had (and then they called in advance to let us know), have not run into this.
Quote from @Andy Sabisch:
You made the common mistake of setting rules and then failing to enforce them.
Rent was due on the first. Late fee was charged on the 4th. Once the late fee is charged, you should not accept any payment unless it is in full, including late fees, and in certified funds (cash, money order, cashiers check) so you aren't waiting for a check to bounce. When you accept a partial payment, the law sees that as willingness to negotiate a payment plan.
When the 15th arrives and you haven't been paid, you need to abide by the lease and start the eviction. If he says his mother is sick and that he'll pay on the 24th, you still start the eviction. If his Aunt Edie died and he has to fly out for the funderal, you stil start the eviction. You can always stop the eviction process if the Tenant fails to make good on their promise to pay. If you had followed this process, you would already be paid in full or the Tenant would already be gone.
Your meeting is to get to understand the Tenant? The truth is, the Tenant is going to make excuses and promises that aren't worth a wood nickel. You should reiterate the rules and make it clear that from this day forward you intend to stick to the deadlines established in the lease and act accordingly. If the Tenant can't abide by the agreement, they should seek other accommodations.
My personal process: If the tenant gets with me before rent is late, has good communication and I have a good feeling about it. I will try to work with them for a max of 1-month. If they don't get with me I follow the lease to a tee. I never waive the late fee's and post a notice to quit regardless of their story.
#2 Innovative Strategies Contributor
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- Royal Oak, MI
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#2 Innovative Strategies Contributor
- Property Manager
- Royal Oak, MI
@Andy Sabisch recommend you review your nonpayment process and update as needed.
Our lease states rent due on 1st, we have a 5 day grace period and then EVERYONE with a past due rent balance gets an eviction notice. Then it's a race against time for the tenant to pay to avoid a court date and additional fees.
We don't care what excuse the tenant gives, or even if they notify us in advance, they all get the evicion notice.
A well designed system makes nonpayment the tenant's problem, not yours.
Quote from @Drew Sygit:
@Andy Sabisch recommend you review your nonpayment process and update as needed.
Our lease states rent due on 1st, we have a 5 day grace period and then EVERYONE with a past due rent balance gets an eviction notice. Then it's a race against time for the tenant to pay to avoid a court date and additional fees.
We don't care what excuse the tenant gives, or even if they notify us in advance, they all get the evicion notice.
A well designed system makes nonpayment the tenant's problem, not yours.
Excellent words of wisdom . . . thanks for that nugget. Already have modified our leases to reflect that moving forward and with this one tenant, we told them the expectations again and may just need to collect the late fee each month until their lease is up if the talk did not change the behavior.
Again, great input and shows just how powerful the BP family is . . . Thanks!
Collect the rent and collect the late fee.
Probably more cost effective than a turn.
They can't pay the rent, or won't pay the late fee--bye bye.
I guess depends on the state your in. Where I am it doesn't necessarily pay to be a strict Hard A--, if it truly is a workable situation. Once its in legal, most likely you can forget about collecting any cash from them and if they decide to appeal which they can easily do, it gets dragged out for months and can turn into a real nightmare.
@andy sabisch I am going through the exact same scenario, and they gave me the same excuse, for a minute I thought this was my post. How did it turn out for you ? I finally started the eviction process, just waiting on a court date. In the meantime the tenant is just living in the property rent free and hasn't bothered to reach out to make a payment.