Tenants can come up with all kinds of excuses for not paying the rent. So, landlords must understand the laws and processes for sending late rent notices and collecting late rent payments.
With all the negative repercussions for tenants, such as late rent fees, bad credit ratings, and negative references from landlords, it’s surprising how common this issue is.
Dealing with a tenant late in paying the rent, whether for the first time or as a repeat offender, can throw up several troubling dilemmas for landlords.
You need to have a process in place to handle this breach of contract consistently in accordance with the law.
Follow the Steps in a Legal Eviction Process
Following the clear process the law lays out for late rent payments reduces the strain on your time and energy and gives the tenant the clear signals they need to understand the consequences of not paying rent on time.
Taking all the right steps in the correct eviction process from the start also means that the court proceedings will be much smoother if it comes to eviction.
Here is a simple and quick breakdown of the steps you should take when a tenant is a late rent offender.
Act Quickly and Consistently
If you’ve double-checked your financial records, and the rent meant to appear on your invoice has not arrived, then it’s time to take action.
According to the specific laws of your state and the terms of your lease agreement with the tenant, there will probably be a grace period of 3-5 days, after which a penalty for late rent payment may kick in.
You can’t retroactively enforce a late rent fee unless clearly stated on the contract, so it is wise to make sure you include one from the start.
An excellent first step is to get in touch and remind them politely that the rent is overdue and that the late rent fee will kick in accordingly within the next few days if they don’t make the payment. This demonstrates that you are on top of the situation and gives the tenant a fair warning if it was a simple error.
Try to Find Out Why Late Rent is an Issue
Of course, there should be no valid legal excuse for your tenant to fail the obligations on the contract they signed with you, but it may be helpful to try to find out if they are struggling financially for whatever reason.
Perhaps they have been laid off at work, sick, or struggling to adequately manage their finances. Being armed with this information will help you understand how you will deal with this tenant and their late rent problem.
Contacting your tenant excessively may be harassment, so limit your phone calls to one or two.
If it’s impossible to get through via phone, you can resort to an email.
If you feel sympathetic to the tenant and trust they will make good on rent payments in the future, perhaps work out a late rent repayment schedule, spreading the overdue rent across the rest of the remaining tenancy.
Get this agreement into a written document signed by both parties. Landlords have different opinions on this matter, and it very much depends on the circumstances. If a dose of sympathy and patience is inappropriate for the tenant in question, proceed to serve the tenant a Late Rent Notice.
Serve the Tenant a Late Rent Notice
As a counterpart to your phone call, you can send your tenant a formal Notice of Late Rent.
This should include a list of all the expenses owed (including the late fees) and a warning about the legal action you will take unless the tenant pays the rent by the stated deadline.
Keep your copy of this document as well, to use as evidence in court later if it comes to that.
It can be served to the tenant in person, by email, or taped to the residence door. Not all states require this step, but it will help make the tenants realize the gravity of the situation and hopefully encourage them to pay the rent promptly.
Serve an Eviction Notice
If the date of your deadline for payment is here and the situation still hasn’t changed, then it’s time to serve up an Eviction Notice, also known as a “Pay or Quit Notice.”
This is the formal beginning of the eviction process, which gives the tenant the option to pay the rent immediately, or they have 3 to 7 days to leave the property (check your state law to see what the regulations stipulate).
Go to Court
If the final deadline of the eviction notice has passed and the tenant has still refused to pay or vacate the premises, consult with an attorney at the earliest possible opportunity and get a date for a formal court hearing by filing a tenant-landlord complaint.
Have your documentation ready, including the lease agreement and copies of all written exchanges between parties.
A judge will decide whether or not your claim against the tenant is valid. If the court supports your claim, the tenant must vacate the property, and a sheriff may supervise while the tenant removes his or her belongings from the residence.
Actions to Avoid at All Costs
A few things are highly inadvisable to do when a tenant is late with payments. Such actions could see you end up on the wrong side of a court case and will likely prolong the eviction process for months longer than necessary.
- Get angry – becoming aggressive, violent, or threatening with your tenants may cause them to bring a case against you. It’s also unnecessary; the courts are there to help defend your rights as a landlord, so stay professional and calm in your interactions with your tenants.
- Accept partial payments – if you suspect a case will end up in court, do not accept partial payments of the money owed. This will void any legal action you take against the tenant and prolong the stay of unwanted tenants as you restart the lengthy process of eviction from the very beginning.
- Harass the tenant – showing up at your tenant’s property unannounced and demanding entry or contacting them too frequently can be interpreted as harassment, which violates several laws and tenants’ rights. You may find yourself arrested if accused of this. If tenants are unresponsive to your communications, follow through with the eviction process in accordance with the law. Send letters by Certified Mail and request a return receipt, which you can use as evidence that they have seen any communications sent to the tenant.
- Attempt to evict the tenants yourself – this is known as a “Self Help Eviction,” and it is, simply put, illegal. Actions such as cutting off the utilities, forcefully removing the tenant’s property, changing the locks, or threatening the tenant give the tenant grounds to file a court case against you. Being sued for a wrongful conviction, assault, slander, battery, libel, or the intentional infliction of emotional distress will cause you far more trouble long term than simply dealing with a problematic tenant appropriately.
Alternative Options to Serving an Eviction Notice
If you want to avoid the costs and hassle involved with the legal process of an eviction, you can consider simply asking the tenant to move out by a specific date and thus canceling the late rent they owe you.
This may be a lifeline for tenants strapped for cash and could provide you with a quick and easy way to replace the tenant with someone more reliable who can foot the rent.
Another option is to follow a process known as “Cash for Keys,” which involves paying the tenant a certain amount in exchange for leaving the property clean and handing over the keys to the property.
Make sure any verbal agreements are put down in writing and signed by both parties.
Don’t hand over any money until tenants give you keys and remove their belongings from the property.TIP
Of course, if the tenants refuse to take these offers, you will be forced to take legal action against them to formally evict them. But if you follow these guidelines and adhere to the state’s specific laws, you should not have any trouble.
The most important thing in the face of late rent payments is to keep calm and respond in a professional and prompt manner.
