Almost every landlord has his or her own approach to the late rent problems, but acting at full pelt is not the best way out of this situation. Landlords who react abruptly can put their business at risk of causing damage to the property by tenants, while being too soft may lead to recurrent infractions, so the amount of late rent fee can rise to a higher level than the agreed security deposit.
Considering all objective factors, there are plenty of questions that should be answered before taking any steps regarding late rent collection:
ACT STRATEGICALLY
The first step to take facing the late rent frustration is Late Rent Notice. Sending this reminder is your first legal action towards collecting past due disbursement from a tenant. A late rent notice should only contain facts and should never contain negative comments about your renter. This notice should be based on the lease or rental agreement and set out the amount of the rental payment, the due date and the fine for not paying the rent. You can't charge more than it is specified in the lease for a late charge. If this notice is ignored, try to set-up a meeting to discuss why your tenant wasn't able to pay in time, maybe there is some emergency circumstance. In this case you may offer a payment grace period – you never know what exactly is going on in your renter's life.
CAN I CHARGE THE LATE FEE?
You may not impose late fees to your tenant, unless the lease has a late fee clause, or unless you have notified tenant about the policy while entering into an oral agreement, no matter how reasonable those additional charges are. Before signing a lease with your tenant, ensure that late fee clause is spelled out clearly in order to avoid evictions. First, check your state laws, some states don't allow landlords to impose late fees, other limit their amount. This amount should be based on the rental payment and should vary around the 5% of month rental price.
Normally, a 5% late fee shouldn't be applied until at least four days after the rent payment due date. But in case your tenant refuses to pay rent for more than 10 days, you better consider charging more than 5%. Remember, try not to charge more than 10% as most courts consider the imposition of enormously high late fees.
Also, late rent fee should be imposed in case tenant ignores the Late Rent Notices.
If there is no penalties for rent payments delay tenants can make a habit of it, don't let it slide!
Due Date!
WHEN THERE’S NO LATE FEES DETERMINED
It's illegal to ask tenants to pay late rent fee, if it's not included in your lease or rental agreement. However this rule of law may be bypassed in other way, even if the rental agreement or lease are not broken.
If your renter refuses to pay the rent you can ask him or her to move out at the first legal case. This can be done easily by the proper notice or just by refusing to renew the lease after it's expiration. In most states landlords can finish a month-to-month agreements. You can ask tenant to move out by not renewing a lease, without giving any reason. However, some states prohibit landlord retaliation, so better read the state law once again. No one wants to bog down in an unnecessary litigations fighting over $50.
KEEP TRANSPARENT DOCUMENTATION IF YOU ARE GOING TO EVICT
If your unscrupulous tenant uses all means available so as to escape the rental payment, you should consider going to court, especially if the debt sum has risen over the 2 months rent.
State eviction laws also vary. You can begin the lawsuit process as soon as your state law allows for non payments as it usually takes more than 1 month to evict a tenant. Furthermore, the eviction process often doesn't begin until the To Pay or Quit Notice is filed. This document is more official than the Late Rent Notice and is the first step in the eviction process. With this document you show your serious pursuing intention, so it should be delivered to the tenant in person if the rent is still late. It has to notify renter about the eviction, the amount of debt, and the due date.
Also, before you go to the court for recovering the unpaid rent, you will still need to back up your claims with clear documentation. Keep all necessary payment receipts to show tenant’s payment history, so you can assert their habit to pay rent late in court. Be careful with accepting partial payments, as they mean altering the terms of the lease or rental agreement in some states. Any accepted amount could be considered as a new monthly rent. In addition, once you take a partial payment it will be that much more difficult to get the rest.
These aforementioned statements were designed to protect landlords' property management and investment business from the financial losses, but not to declare war against tenants. Striking a balance between being tough yet understandable with your tenants literally helps maximize returns. eproperty
Almost every landlord has his or her own approach to the late rent problems, but acting at full pelt is not the best way out of this situation. Landlords who react abruptly can put their business at risk of causing damage to the property by tenants, while being too soft may lead to recurrent infractions, so the amount of late rent fee can rise to a higher level than the agreed security deposit.
Considering all objective factors, there are plenty of questions that should be answered before taking any steps regarding late rent collection:
ACT STRATEGICALLY
The first step to take facing the late rent frustration is Late Rent Notice. Sending this reminder is your first legal action towards collecting past due disbursement from a tenant. A late rent notice should only contain facts and should never contain negative comments about your renter. This notice should be based on the lease or rental agreement and set out the amount of the rental payment, the due date and the fine for not paying the rent. You can't charge more than it is specified in the lease for a late charge. If this notice is ignored, try to set-up a meeting to discuss why your tenant wasn't able to pay in time, maybe there is some emergency circumstance. In this case you may offer a payment grace period – you never know what exactly is going on in your renter's life.
CAN I CHARGE THE LATE FEE?
You may not impose late fees to your tenant, unless the lease has a late fee clause, or unless you have notified tenant about the policy while entering into an oral agreement, no matter how reasonable those additional charges are. Before signing a lease with your tenant, ensure that late fee clause is spelled out clearly in order to avoid evictions. First, check your state laws, some states don't allow landlords to impose late fees, other limit their amount. This amount should be based on the rental payment and should vary around the 5% of month rental price.
Normally, a 5% late fee shouldn't be applied until at least four days after the rent payment due date. But in case your tenant refuses to pay rent for more than 10 days, you better consider charging more than 5%. Remember, try not to charge more than 10% as most courts consider the imposition of enormously high late fees.
Also, late rent fee should be imposed in case tenant ignores the Late Rent Notices.
If there is no penalties for rent payments delay tenants can make a habit of it, don't let it slide!
Due Date!
WHEN THERE’S NO LATE FEES DETERMINED
It's illegal to ask tenants to pay late rent fee, if it's not included in your lease or rental agreement. However this rule of law may be bypassed in other way, even if the rental agreement or lease are not broken.
If your renter refuses to pay the rent you can ask him or her to move out at the first legal case. This can be done easily by the proper notice or just by refusing to renew the lease after it's expiration. In most states landlords can finish a month-to-month agreements. You can ask tenant to move out by not renewing a lease, without giving any reason. However, some states prohibit landlord retaliation, so better read the state law once again. No one wants to bog down in an unnecessary litigations fighting over $50.
KEEP TRANSPARENT DOCUMENTATION IF YOU ARE GOING TO EVICT
If your unscrupulous tenant uses all means available so as to escape the rental payment, you should consider going to court, especially if the debt sum has risen over the 2 months rent.
State eviction laws also vary. You can begin the lawsuit process as soon as your state law allows for non payments as it usually takes more than 1 month to evict a tenant. Furthermore, the eviction process often doesn't begin until the To Pay or Quit Notice is filed. This document is more official than the Late Rent Notice and is the first step in the eviction process. With this document you show your serious pursuing intention, so it should be delivered to the tenant in person if the rent is still late. It has to notify renter about the eviction, the amount of debt, and the due date.
Also, before you go to the court for recovering the unpaid rent, you will still need to back up your claims with clear documentation. Keep all necessary payment receipts to show tenant’s payment history, so you can assert their habit to pay rent late in court. Be careful with accepting partial payments, as they mean altering the terms of the lease or rental agreement in some states. Any accepted amount could be considered as a new monthly rent. In addition, once you take a partial payment it will be that much more difficult to get the rest.
These aforementioned statements were designed to protect landlords' property management and investment business from the financial losses, but not to declare war against tenants. Striking a balance between being tough yet understandable with your tenants literally helps maximize returns. eproperty