Unfortunately, late rent is a fact of life. While you would like to think that all of your tenants will pay rent on time every time, this sadly is not always the case. This is not always a huge deal. We all know that “life happens” and rent can sometimes be delayed, even with the most reliable tenants. If this starts to become a frequent issue – one that is causing you countless headaches – then certainly some steps need to be taken to correct the problem. This article will delve into some recommended ways for handling late rent.
Have A Policy Set Down In Writing
As with many issues when it comes to leasing out property, it is important to have a policy on late rent written down on the lease agreement itself. For one, this allows you to communicate your expectations to the tenant in no uncertain terms. Secondly, it gives you legal recourse if you feel that you are being taken advantage of. The way you handle late rent is up to you. Perhaps a daily fee will be charged after a certain grace period (say, five days). You want a policy that will not scare off most potential tenants, but that will help ensure that your rent money comes in at the beginning of the month, every month. This is, after all, your income. You deserve to receive it on time!
Encourage Your Tenants To Set Up Automatic Payments
One great way to cut down on late payments is to set up automatic payments. This is more convenient for you and the tenant. With an auto payment set up, the rent will deduct from the tenant’s account and go straight to yours—no need to deal with checks or money orders. Most importantly, you will not receive a late payment because the tenant forgot that it was the first of the month. It is important to let the tenant know that the money needs to be in their account when the automatic payment is due. If they don’t want to set up auto payments, encourage them to at least set up an online bill pay option. They have to remember to submit the payment every month, but at least you will not have to deal with checks. By purchasing some good landlord software, you can give your tenant the option of using automatic payments/online bill pay.
Stick To Your Guns
As mentioned before, things happen. Sometimes a tenant will have a legitimate emergency that prevents them from paying the rent on time. If this happens habitually though, it is likely that the tenant is taking advantage of you. This is why it is important to charge the late fees that were agreed upon in the lease. In extreme cases, eviction may even be necessary. An eviction isn’t a pleasant experience for any of the parties involved, but if rent is consistently late, it may be best to start over with a new, more reliable tenant.