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As a Landlord do you tolerate late rent payments?

By
Real Estate Agent with Prudential Ambassador Real Estate

As a landlord my guess is that at one time or another you have been faced (probably now more than ever ) with a tenant telling you that they cannot pay the rent on time this month because of this or that and their problem now becomes your problem right?

Perhaps in the future you can alleviate the problem if you create the expectation that you will not tolerate late rents.

Never forget that as a landlord you and your family come first. I have seen many landlords that have been well trained by their tenants and accept all the reasons and excuses why their rent can't be paid on time this month etc. ( some are legitimate and most are excuses ).Has this happened to you? This is probably one of the hardest lessons a landlord must learn.

First, ask yourself why you are  in the rental business. While each situation may be different, sometimes your long term tenant that has paid the rent on time regularly may have earned the benefit of the doubt.

Are any of these reasons familiar to you?

I'M SORRY MY RENT IS LATE BECAUSE.........

A. The check I been waiting for did not come in the mail

B. I was in the hospital/jail and I couldn't get to you.

C. I missed a week's work because I had to take care of my sick mother /son/daughter.

D. I had to have some teeth pulled and the dentist won't start work until I give some money.

E. I was in an automobile accident and I won't have any money until my attorney works things out with the other guy's insurance

F. I had my billfold stolen when this guy jumped me on my way to the bank/post-office/my office.

G. Someone broke into my place and took my money.

H. I had to have my car fixed so I could get to work, so I could pay you.

I. My mother/sister/uncle hasn't mailed me my money yet.

J. I couldn't find your address. I put the wrong address on the envelope.

K. I got laid off from my job and I won't get unemployment for a couple of weeks.

L. I was not able to get a money order and I know you didn't want me to send cash.

M. You didn't come by when I had the money

N. My husband/wife/boyfriend/girlfriend/roommate left and I didn't have all the money.

O.They garnished my check and I don't understand it, because the guy told me it would be ok to just pay so much per month and I only missed a couple of payments.

P. I told my friend to bring it or send it to you while I was out of town

Q. I haven't received my tax refunds yet.

R. I got a new job and I had to work three weeks before I got my first check.

S. I didn't pay the rent because my __ is not fixed. No, I'm sorry I didn't tell you there was a problem before now. I didn't think about it until now.

T. My car is broken and I didn't have a ride to your office.

U. I had to help my brother/sister/friend who had a serious problem.

V. I didn't have, or I forgot to put, a stamp on the envelope.

W. The check is in the mail, didn't you get it?

X. I ran out of checks.

Open Letter for Tenants that don't pay the rent on time

What would you do if you worked hard all week and on payday your boss told you that you were not going to get paid and ... that you would have to wait and wait and wait for your money and ... that he did not know when (or if) you would ever get paid?

How would you feel? And what would you do about it? How long would you work without getting paid? Would you just say ok I understand, just pay me whenever you can or would you call your boss on the phone? What if he refused to return your calls?

Would you send letters? What if your letters were ignored? Then what would you do? Would you go to his or her office? Would you argue? Would you report him to a government agency whose job is to protect working people like you?

Would you hire a lawyer and pay big bucks that you will never see again? Would you agree to pay court costs and the legal fees that begin to pile up the moment you tell your lawyer to sue?

The bottom line you would not be very happy as your bills would pile up and then you have to borrow money from relatives, friends etc., to pay your bills, groceries, gas and on and on. You likely would have to make choices as to what bills you pay first right?
For sure you would buy groceries, gas to get to work, pay your utilities, etc and other bills and maybe whatever was left over you would pay part of the rent and I wonder why?

Unfortunately, as a property owner I don't have many choices with the bank as my mortgage payment must be paid on time each and every month otherwise I am charged a late payment penalty and my credit is affected.

The bank doesn't care if you pay your rent on time or not, but I do otherwise I get into financial difficulties myself: I have to make choices of which bills I pay first and the answer is always my mortgage before anything else and in your case it should be your rent.

So in conclusion. I expect to receive the rent on time each and every month, just as you expect to get your pay check on time each and every time as you would not be very happy if you did not get your pay check on time.

The next time you are thinking about picking up the phone, or I have to call you and you tell me that you cannot pay your rent on time this month because ....... It will not make me very happy so I hope you understand.


Lot's to think about ..
Here's your first step: if you are interested in becoming a landlord feel free to contact anyone of us on the Omaha Real Estate Investing Team for a confidential consultation: Prudential Ambassador Realtors Fred Tichauer, 402-679-3914 or Shawn Prouse at 402-955-9058.Kelly Kirk 402-680-4153,Luis De La Vega 402-306-1212 or Paul Sadofsky at 402-680-7268 and you will be happy that you did.

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Comments(7)

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Barbara Todaro
Retired...Mentoring Newbies - Franklin, MA
Previously Affiliated with The Todaro Team

It's been decades since I've owner investment property....today I have one single family investment property that I rent to family....but years ago, the first time they were 30 days late, the received a "notice to quit"....if they didn't leave, Uncle Giovanni took over.....they always left...of course, that was then......this is now.....I'm done with that end of real estate. 

Jan 08, 2010 11:56 PM
Loreena and Michael Yeo
3:16 team REALTY ~ Locally-owned Prosper TX Real Estate Co. - Prosper, TX
Real Estate Agents

I'm going to include:

Because it came to me as a surprise the kids go back to school in August and they grew between Summer and Fall and now we need to spend $$$ on their clothes before they head back to school.

Or;

Surprise, Christmas is in December so I need to spend rent money on presents instead of paying my rent on time.

Jan 08, 2010 11:59 PM
FN LN
Toronto, ON

Fred - This is a great list of late payment excuses and a fantastic  letter analogy that you have shared.

Jan 09, 2010 12:02 AM
Fred Tichauer
Prudential Ambassador Real Estate - Omaha, NE

Thanks . Great one's to add to the list.

Jan 09, 2010 12:02 AM
Fred Tichauer
Prudential Ambassador Real Estate - Omaha, NE

Thanks Mark: Have been a landlord for over 35 years and have  heard every excuse and reasons you can imagine. Most tenants are good hard working people and honest. Have to create the expectation . Take care

Jan 09, 2010 12:05 AM
Wallace S. Gibson, CPM
Gibson Management Group, Ltd. - Charlottesville, VA
LandlordWhisperer

My rents are due on the FIRST and late by the FIFTH.  I provide SAE with the lease for the rent payments and I have a $50 per adult late fee AND a $100 per adult notice fee..if I serve a pay or quit, I collect $300 - getting me the RENT on TIME is in the residents' BEST interest.  If I BELIEVE their excuse, I'll WAIVE the late/notice fees PROVIDED they are not late again for the remainder of their lease or any extensions.  They KNOW if they are late AGAIN, they will owe $600 and that is their incentive to re-arrange their budget to pay ME FIRST!

The late/notice fees are mine so I hussle to get my owner's $$$ FIRST

Jan 09, 2010 04:31 AM
Don and Valerie Keeton
RE/MAX The Producers - Omaha, NE
Omaha Real Estate - 402-496-3700

Fred, Your blog reminds me one more time why I don't want to be in the rental buinsess.  I remember when my mom and I would rush to turn off the TV and light if we saw the landlord come for his rent.  My mom was a single parent and had a pooor job situation, so I remember many of those excuese, but my mom had 2 other excuses you didn't list:

  1. I was fired, and don't have a job.
  2. my son was murdered and I had to bury him.

My only point is that bad things happen to good people, and landlords often get caught up in their tennant problems.

You are right, but you have to take some bad with the good.

Don

Jan 24, 2010 09:25 AM