As a landlord, your own financial stability depends on your tenant’s timely payment of rent. When rent stops coming in, it’s easy to get nervous and react from a place of emotion and fear. However, it’s in your best interest to stay calm and professional and to follow the terms of your lease agreement, which likely lays out the rent collection process and the penalties and consequences associated with nonpayment of rent.
It’s important to check and follow all local, state, and federal laws when it comes to rent collection and eviction. Recently, the COVID-19 crisis caused a moratorium on many evictions, and you never want to evict a tenant unless it becomes clear that rent will be impossible to collect. We have some strategies that should help you get rent paid on a timely and consistent basis every month.
Communicate with Your Michigan Tenants
A good landlord will develop and maintain an open and respectful relationship with your tenant. When rent does not get paid, you want to reach out to them right away. Find out if they’ve just forgotten to pay or if they’ve had a complicated financial period and need a few more days to gather the rent money. It’s possible that this is a problem which will be resolved quickly, with a simple phone call or text message.
Always remind your tenants of your rent collection policy when the payment is late. If there’s a late fee or any other penalty, you want to apply it consistently. Tenants who think they can get away with late payments every month will never pay on time.
Create a Payment Agreement When Rent is Late
If your tenant does communicate with you and agrees to catch up with the rent in a matter of days or even in a week or two, that’s good for you because it means you’ll keep a good tenant and avoid the court process. However, you need to protect yourself and hold your tenant accountable. Ask them to sign a payment agreement or a payment plan. This will state how much is owed and when it will be paid. Both you and your tenant will sign it, and you should be able to collect your rent from the tenant as promised. If not, you’ll be able to quickly move forward to next steps.
File a Seven Day Notice to Pay or Quit
When your tenant refuses to talk to you about the late rent or the date of the promised payment comes and goes without the rent showing up, you’ll need to provide at least seven days of written notice before you go to court and ask for an eviction. This is a Seven Day Notice to Pay or Quit, and you can serve it to your tenant or another adult at the property in person or send it through the mail. This is the formal notification that rent has not been paid and you’ll be making plans to evict.
Usually, this will resolve the problem. If the tenant doesn’t want to be evicted, he or she will pay the rent before the end of the seven day period, or your tenant will contact you immediately to let you know when you can expect the rent. If you don’t get the rent paid, your next step would be to file for eviction in court.
You can avoid late rent payments by screening tenants thoroughly. Make sure they have a record of paying rent on time and following their lease terms. You can also work with a professional property management company, where you’re less likely to face problems like late and unpaid rent.
We can tell you more about how we set and follow a consistent rent collection process. Contact us today at Real Property Management Southwest Michigan.
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