Late rental payments are a nuisance for landlords, and you want to avoid them whenever you can.
During your tenant screening process, be sure to look for tenants with a history of paying rent on time and following the terms of their lease. Establish a consistent and clear rent collection policy so your new tenants know what you expect and what the consequences will be if rent is late.
Sometimes, even good tenants fall behind and run into unexpected financial difficulties. In such situations, they may want to establish a payment plan with you to avoid eviction and get back on track.
This can be a good solution in some circumstances. Today, we’re discussing how to protect yourself as a Phoenix rental property owner with partial rent payment plans.
Communication with Tenant When Rent is Late
If you have a good relationship with your tenants, they’ll be able to come to you when they know rent is going to be late or after you’ve served the Notice to Pay or Quit. At this point, the clock is ticking and they know they either have to pay the rent or face eviction proceedings.
Make sure you’re prepared, and always be responsive. Keeping the lines of communication open is always better than having to chase down the late payments. Remain calm and professional, and show your tenants that you’re willing to work with them during their periods of difficulty. They’ll remember and appreciate the way you treated them.
Partial Rent Payments and the Law
You need to understand what it means legally when you accept a partial rental payment. If you accept some portion of the rent in any given month, it means you cannot evict the tenant that month. You’ve accepted the payment, so you cannot evict. You’ll have to wait until the following month and start the process over, beginning with the Pay or Quit Notice.
If you only received a partial payment in October and then November arrives and that month’s rent is late, too, your tenant will likely have a hard time coming up with both the November rent and the overdue October rent. Don’t let yourself land in this situation. You’ll want to get all of October’s rent paid before November rolls around.
Partial Rental Payment Requirements
We have a few things that we require from our tenants who want to make a partial rent payment and agree to pay the rest of the rent that’s owed in the same month.
Have your tenants sign a waiver that says you can and will evict them if they miss the agreed upon payment date for the remainder of their payment. Never accept less than half the rental amount. If rent is $1,400 don’t take less than $700. If your tenants cannot come up with half the rent, you should not accept the partial payment and you should move ahead with eviction.
We can provide you with the paperwork we use to collect partial rent and to guarantee that the remainder of the month’s rent will be paid before the following month’s rent is due.
You should allow a partial rent payment if it’s more than half of what is owed and if your tenant is committed to signing an agreement to pay the rest.
We can help you work out the details. Contact us at Service Star Realty.