I am located in Ohio and have a renter in a home. She has paid on time for 3 months and today her rent is due. I called looking for it and was told she sent me a check in the mail and post dated it for the 12th. Which would make her a week late and she told me Aprils check would be good and april 8, 3 days late. On mays rent she would be back on schuelde. She told me she had a unexpected expence that messed up her money flow.
My question is Do I need to serve her with a 3 day notice or is there anything else that I need to do.
Thanks,
Todd
I would not make a huge deal out of it other than to tell her her rent is late and thus a late fee will be due. I would not negotiate or cut here break either. Just explain it is part of the contract; nothing personal If she does not pay it, I would just take it out of the security deposit at the end.
Changing tenants will easily cost you hundreds of dollars. As long as she is paying (albeit late) and taking care of the place, then don’t get too crazy about it.
Secondly, it is much better to have a tenant that tell you up front that she having issues rather than the standard “I’ll have the rent next week” talk of some many deadbeats. With that said, watch this account closely and make sure she meet her self-selected dates (alebit late). If she misses them and/or this late payment thing drags on, then time to get a new tenant.
Some thoughts from 6 yrs of landlording experience.
Mike
P.S. Whatever you do, never cut “deals” (i.e. waive late fees etc).
You are being tested. This tenant has only lived in your place for 3 months!!! Now, her priorities are to pay something or someone else before you. I don’t know about you, but there isn’t much higher priority than somewhere to live!. I’d follow the lease to the letter. You should have explained this to her when you signed the lease - that you strictly follow the lease. The day after the rent is late, file the 3 day notice. Then, on the fourth day, file the eviction. As AAK said, charge the late fee as soon as the rent is late. Once you file for eviction with the court, don’t accept any rent - they’re out!!! You can not afford to have a tenant that won’t pay on time. Even worse, you can’t afford to get the reputation for being a weak landlord.
Good Luck,
Mike
I yiiiiiiiii yiiiiiiiiiiiiii yi yiiiiiiiiiiiiiiiiiiiiiiiiii
I second that of propertymanager…
You have to stick to your lease agreement. My rent is due on the 1st, payable by the 5th. A late payment is due on the 6th and a “pay or quit” is served. If payment is not recieved by the 10th, I file for eviction on the 11th.
If you start to bend the rules you will have to do that for everyone…Fair Housing Laws. Stick to the lease.
If you start to bend the rules you have just told the tenant that your lease is negotiable.
What if they dont pay in April…now you dont get March or April? Now you are two months behind in payment and have to start the eviction. So you take money from the security deposit and then the tenant trashed the place on the way out. By the time you evict, fix the place up and advertise you are looking at May/June at the earliest to rent it out again. You are all of a sudden out of 4 months rent plus repair costs.
What is worth to you to follow the lease???
Thanks for all of the response.
I did serve her with a three day notice and explained to her that I have a house payment too and I expect her to go by the lease just as she would want me to. Just protecting myself.
Thanks,
Todd
Good job Todd!!!
You are doing the right thing by setting your boundaries up front. After you set a tenant straight and they realize you mean business they will learn to respect you and the lease.
CHEERS!!!
OHLandlord
Hi everyone,
I had a tenant for 18 months in a condo in Florida who was chronically late in paying rent. I would phone her to discuss and she was traveling, and so on…but I agree, you pay mortgage before all else. Anyway, I never did collect late fees, now she has moved out and I have been trying to find out if I can use security deposit to collect late fees, and hearing confllicting answers. According to Fla law landlord has 15 days to return full deposit or 30 days to send notice with explanations of claim (damages) against the deposit. But I still don’t know if late rent fees can be deducted. Anyone know for sure?
Thanks,
REFLA
REFLA I too am a southflorida landlord and the answer to your question is NO.UNLESS your lease states that all unpaid late fees will be resolved via the security deposit and they initial this at the time of signing the lease.I have every tenent initial next to every clause on the the lease in addition to signing at the end.a little redundant but when you get to court the whole I DIDNT READ THAT defence doesnt hold up.and a little FYI… since I stopped listening to the guru’s and started becoming FLEXIBLE with my leases I have not had an eviction.If someone is late I simply tell them thats fine but lets not make a habit out of it .If it happens again I have them sign a paper stating they are going to pay me in a certain time frame or they will loose their deposit for breach of contract .That usually streightend them out.As Ive said in the past and its common sence.If they cant pay the rent they deffinatly cant pay the late fee right now.So lets kick them out piss them off take their deposit stand in line at the clercks office to file the eviction …the default…show up in court cause they decided they want a trial… rehab the prop after they move …pay for advertising …show the prop to a dozen sightseer’s…I yI yi Yi YIIIIIIIIIIIIIIIIIIIIIIIIIIII … cut them a break if they are NOT cronicly late,you’ll sleep much better.I do.
along the lines of campbell group, I have just two goals in being a landlord.
- maximize the amt of rent collect
- make sure my properties does not get trashed.
If a tenant does not pay by the 8th, I don;t sweat it too much. I’ll even take partial payment. I look for 2 things from a tenant in this situation 1) the money keeps come in to me 2) communication. When one or both of those stop, then its time to get out the ol’ 3 days or quit notice.
I’m not intersted in getting respect from my tenants (they can hate my guts for all I care) or “teach them a lesson” as I’ve heard from many landlord. I’m not running an education institution and I be blunt about it; I jsut want their money.
Plus if you go an read a any serious negotiation/management book (not that trash they sell at the airport news racks), it has been clearly shown time and again that the authoriatrian way of manageing dealing with people yields the lowest results. Simple put, the “club over the head” approach is not as effective as other techniques. Little do you realize, but payment is a voluntary action. If you piss someone and they want to spite you, they will just ignor you and not pay. Some people could give a rat-ass if you drag them into court and put a mark on their credit. That’s not to say that I get lovey-dovey with my tenants. I’m all business and never cut deal, waive fees, etc., but I do promote atmosphere of cooperation and calm communication. This goes a long way to get paid. Ya, its nice to thing about dragging your delinquent tenant into small claims court to collect back rent, but I bet you fill a 100 dumpster witll the unpaid judgements landlords have collected over the years.
So IMHO, be firm, be professional and focus on maximizing revenue. Eviction is a money losing process!!! At best, you will breakeven (i.e. collect what you are owed), but thats pretty rare. More often , you lose 1-2 month rent, fees for the eviction and end up with a dirt and damanaged rental unit that needs work before you can rent it again.
Happy Landlording.
Mike in Calif.
I have found through experience that things that work when you have a very small number of rentals don’t necessarily work when you start to accumulate a larger number of rentals (especially apartment buildings).
While the touchy-feely approach may sound very nice, it does not work when you’re running a rental BUSINESS. When you only have a few rentals, you can get away with doing just about anything, because the amount of money involved is so low and the time between incidents is so high. For example, if you have 3 rentals and do proper screening, you might only have an eviction once in several years. Things happen in slow motion. However, if you have 30, 50, or 100 rentals, you will have evictions much more often.
Additionally, as you get more rentals, it becomes common knowledge that you have rentals all over town. You get a lot of tenant referrals from other tenants. In apartment buildings, the tenants all know each other. When you don’t enforce the lease, you’re asking for disaster. IF you don’t make sweet Mrs. Jones pay the rent on time, then why do the other tenants have to pay on time??? The correct answer is that they don’t! Legally, you can’t treat tenants differently and once you set a precedent - you’ve got a major problem. You didn’t follow the contract with Mrs. Jones regarding the rent so why should any other tenant expect you to follow the lease on ANY other issue. This is an excellent way to put yourself out of business in a hurry.
One final point is that tenants LIE - OFTEN! I’ve heard just about every excuse for not paying the rent on time: their car broke down, mother is sick, they had to buy medicine, the tenant had a stroke, their money was stolen, etc. EVERY one of these excuses was a lie. Here are the actual translations to these excuses from some of my tenants this past year:
car broke down = spent $400 on a dog
mother is sick = bought a big screen TV
had to buy medicine = bought crack
the tenant had a stroke = she wanted new carpet (she claimed the lack of carpet caused her to have a stroke - a stroke that she didn’t really have)
money was stolen - true, but she forgot to mention that it was stolen by her daughter who lives with her
In every one of these cases, I followed the lease to the letter. In two of these cases, I evicted the tenant. In the other three cases, they had the money (must have slipped their mind) and an eviction wasn’t needed.
The point in following the lease to the letter is that you want the tenant to pay you FIRST. If they know that you mean business, they will pay you first. If they know you’re a weak landlord, they won’t. It’s just that simple.
Finally, as OHLandlord said, failing to promptly enforce the rent only results in larger losses. When you quickly evict, you minimize your losses and can move on with things. When you accept excuses, your losses dramatically increase!
Mike-OH
Mike-OH
What part of OH are you in? How many different buildings do you own? Whats the largest and smallest unit numbers?
I currently have two-families. I would like to exchange and consolidate into a large complex. I still have experrience to gain before the 50-100+ units but I would like to get into a 8-10 unit.
OHLandlord
prop mgr, we certainly agree on many thing including that you have to run things as a BUSINESS and keep thing tight (no side deals, follow the lease) (I currrent have about 30 units in several locations). The current lease I’m using on some of my properties is 9 pages with an addendum of 29 pages with rules and regulations. (i.e. I get people out on a lease violation pretty much whenever I want) As part of my lease, I have stiff late fees. If people want to put an extra $50 in my pocket for paying a few days late, no problem. With that said, if I get silence and/or no money by about the 6th of the month, phone are ringing and I got people over there knock on doors. I use 3 day or quit fairly often, but I’ve look pretty lcosely before I file a UD (I was always use a eviction firm for this, no messin’ around). Also, if people are consistantly late, I usually suggest that they consdier moving out when a suitable tenant is placed. Since I have a strong pipeline of applicants, I can have someone ready to move in usually right away if the current tenant does a “midnight move out”.
So, I’m suggesting there are various ways to achieve the same goal. Moreover, I’ve seen way to many people get emotional involved in the situation/dealing with tenant. This is “the road to destruction” (IMHO) when dealing with tenants. Keep thing professional, business-like, but keep the pressure on the tenant as well. Obviously, one need to select the technqiue(s) that fit their personal style and their landlording situation. 8)
OHLandlord,
I am near Columbus and currently have SFHs, duplexes, triplexes, four-unit and six unit buildings. Six units is currently my biggest building (and also one of my best).
AAK,
I think that we agree on most of these issues. I can’t even imagine what you have in a 9 page lease with 29 pages of rules. My lease is only 4 pages including the rules. Of course, I’m sure that Ohio is a much more landlord friendly state than California.
Mike
Sadly, I have finally come around to what you hear almost all of the very seasoned professionals say–be tough and hold the line. Tenants are late on their rent payments for a number of reason, all of which sound good to them, but they’re getting the use and enjoyment out of your quarter million dollar liability for free. I’m not a jerk and I really do hate having to hold the line but, and this will sound terrible although it’s a great analogy, tenants often act like children…testing the limits to see what you will let them get away with and if you set the rules out in the beginning, firmly, and hold to them, mostly they pay on time every time and focus their efforts elsewhere. That said, if it still makes your stomach wobble to ask someone to pay you what they owe, when they promised to pay it…try these suggestions:
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Invoice your tenants every month. Invoicing increases on time payments by over 30%. Set up a reminder in Outlook on the 20th of each month that says “Send invoices to tenants” and attach a blank invoice. Email it out to all your tenants with their specific rent, remit to address, and details. A lot of times, tenants just forget when to send the rent in. Help remind them. You might even want to mail this out with a self-addressed, pre-stamped envelope with the invoice so they can just cut the check and slip it into the mail. No excuses and the $1 you pay will greatly enhance the likelihood of getting rent on time.
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Set up recurring rent debit payments from their checking account. Nearly 100% of mortgages and car loans “require” this now–the reason they do? Nearly 99% payment on time. And, the tenant has the benefit of knowing when the money will be deducted from their rent, helpful if they live hand to mouth. You can set this up with any of a LOT of online companies.
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Online rent payment. In addition to your email invoice, include a link to your payment gateway. There are companies that specialize in collecting online rent payments. Yes, you will pay between 1-3% transaction fee, but you get nearly 100% guarantee of ontime payment and they get to accumulate frequent flyer miles, cash back points, and a lot of convenience. Whether the idea sounds attractive to you the landlord or not, tenants are demanding this and it’s becoming increasingly popular.
Tough is good. Enabling your tenants to pay rent on time by removing obstacles and increasing awareness and convenience works better.
-Jeff
Jeff,
Good idea on getting the payments through direct withdrawal, online withdrawal, etc. This might work with some lower middle class tenants.
Unfortunately, the worst tenants are low class tenants living in low income apartments. They don’t have checking accounts, bank accounts, credit cards, computers, or even cars. They don’t work and usually get their money from a government agency - most often SSDI. These people live entirely with cash and the landlord had better get it as soon as the tenant receives their check or it WILL disappear.
I spend the first four days of every month collecting rents. As soon as the tenants receive their government check, they call me and I go pick up the rent in cash. I use the rent pick-up as an opportunity to do a walk through inspection of every unit every month.
Mike
I hope I never get into this type of building!! :o
I hope I never get into this type of building!!
Joel,
These low income buildings are some of the most profitable around. They are definitely more trouble and you frequently become a mother (or at least the tenants want you to be) as well as a landlord. However, many of these people stay longer and are better payers than typical tenants (if you put in the work). All of my longest staying tenants are in my low income buildings and the profits are much higher than SFHs.
On the other hand, some percentage of these tenants are very erratic, are mentally ill, move often, and can be dangerous.
Mike
takleberry,
Good post!! Sounds like you have been listening to some of the audio resources on this web site 
I must agree that everything you posted are great ideas and I believe they would be very good efforts in collecting rent.
Another option…maybe setup a rewards program with your tenants. 12 months of on-time rent and you give the tenant a FREE DVD Player ($30)…24 months a TV, etc. YOu can go out and get these things for cheap. It keeps the tenants happy and gives them a motive to pay the rent. Who doesnt want a FREE DVD player or TV???
The more creative you get the better success you will have in this business.
OHLandlord
Our current renter is the WORST! She used hurricane katrina as an excuse and she lives 1500 miles away from New Orleans. She has left a bad taste in our mouths. The funny thing is her credit score was 503 and it made us hesistant but she has 3 kids and we wanted to give her a chance…well we are regretting that.
Her rent is usually about 14 days late. The lease is up in july. We will be saying bye bye to her. Good riddance!