Having tenants who don’t pay rent on time is a fiscal liability for you as a landlord. Use this guide to prevent non-payment and understand what steps to take in the case of non-payment of rent.
As a landlord, the biggest headache you can experience is not being paid for rent by your tenants. The process to evict or force the tenant to pay can be long, and takes money out of your pocket. It’s important to work in advance to protect yourself in the event of non-payment of rent.
Each state has its own set of landlord rights, so find out what you’re entitled to in your state before even renting your property. There is a different time period you must allow a non-paying tenant to pay before being evicted, and every day without payment costs you money.
The first and most important step in being a protected landlord is to prepare a solid lease agreement. In it, you should specify when rent is due, and what consequences there are for paying late or after a certain date. Include details on eviction and the process.
Landlords who require background checks tend to see fewer non-payment tenants, so include in the agreement a request for background check. This can help you see if a potential renter has a history of paying rent late, and whether there are any evictions on his file. Choose your renter based on a solid history of paying rent on time.
Important! Always get everything in writing! A verbal agreement will not hold up in court, so even if it is a handwritten statement, ensure that everything is written down and signed for. This way, a non-paying tenant cannot say he was not aware of your eviction policy. Keep copies of all documents.
What to Do When Rent is Late
If rent has not been paid by the date set forth in the lease agreement, send your renter a rent collection reminder. In it, you can specify the absolute latest date rent can be paid before an eviction notice is filed. The renter can move out before the notice is filed (which is sometimes easier for you than having to take it to court).
If you speak to the renter about the late rent, only speak to the tenant who signed the lease. It is illegal to discuss nonpayment with other family members or employers. Make sure to follow this process to a T to avoid any legal implications on your part in this situation.
If you’re lucky, your tenant will simply pay rent at this point. Moving can be costly and annoying, so paying rent to avoid eviction should be his first choice.
Moving to Eviction
Depending on what paperwork your state requires, you’ll need to take it to the Clerk of the Court’s office in your city. Once the eviction notice is given to both the tenant and the court, the tenant has a specified period of time to move out. If the tenant refuses to leave, you can contact the Sheriff to assist in physically removing him and his items from the premises.
You may be required to appear in court on the eviction notice. If the tenant wishes to fight the eviction, he will do so here. It is important that you have documented everything in the process, including copies of the notices and letters you’ve sent so that the tenant has no opportunity for recourse.
If the tenant is able financially, the judge will likely make him pay all or part of the rent owed to you, as well as any legal or court fees. If he doesn’t have the money or income to pay you over time, you may be left holding the bag. The good news is, once this non-paying tenant evacuates your rental, you can open it up for rent to another tenant as soon as possible.