Having a tenant who is late with rent payments is stressful, but the process does not have to be difficult to manage. If you have a professional and respectful relationship with your tenants, you should be able to talk about a positive resolution to the problem. Having a solid and consistent rent collection policy in place and a willingness to enforce that policy will also ensure that rent comes in on time.
Sometimes, financial issues happen to even well-qualified, outstanding residents. When your rent is late, be prepared to follow the correct legal steps while you’re trying to resolve the issue with your tenants.
These are a few tips to ensuring you receive your rent on time every month.
It Starts with Screening
The best way to avoid late rent payments is by screening your tenants thoroughly. You want to get a sense that the tenant you’re placing has paid rent on time in the past. You’ll verify this by looking at a credit report and checking for past evictions. If you notice a lot of debts owed to former landlords, you might want to think twice before renting to that applicant.
Talk to former landlords as well. Ask if rent was paid on time or how often it was late.
Communicate with your Tenant
If rent is late, the first step should be to reach out to your tenant. It’s completely possible that your tenant simply forgot or ran into some unexpected issue that’s delaying payment for a day or two. This is no big deal. You should still ask when you can expect the rent to be caught up, and if there’s a late fee in your rent collection policy, you should remind your tenant to include that fee in the payment.
Put All Payment Plans in Writing
Many times, if a tenant is late with rent, they will promise to pay on a certain date. Maybe they need to wait for their next paycheck or they know they’ll be able to catch up by a certain date. That’s great news, and it means that late rent is a problem that has a solution.
Just make sure you document the agreement that was made. Put it in writing and have the tenants sign it. Make sure it stipulates how much is due, when and how it will be paid, and what will happen if the tenant does not pay.
Preparing for Next Steps
If you’re unable to reach your tenants, or they refuse to return your call, or you don’t receive the rent payment when it was promised, you’ll need to take additional steps that leave you the option of ultimately performing an eviction.
Late rent affects your cash flow and can have serious financial implications for landlords. We know that’s frustrating and disruptive to your investment experience. We’re here to help. If you’d like some assistance in ensuring your rent is paid on time, contact us at Real Estate Gladiators.