Becoming a landlord has many great benefits. You can increase your cash flow, build long-term investments, and even get some pretty good tax breaks. But, along with the perks come a few challenges. Some of these are expected and manageable, like repairs and maintenance. While others can be downright unpleasant, such as dealing with a tenant who has fallen behind on rent. Hopefully, this never happens to you, but if it ever does, here are some steps you can take to resolve it.
Communicate with your Renter
When you notice that the rent check doesn’t arrive on time, the best thing to do is try and communicate with your tenant. Wait until the grace period is over (check your lease agreement if you can’t remember how long the grace period lasts), and then try and reach out to your renter. There is always the chance that something happened like an illness or tragedy that has caused the tenant to fall behind. So, if this is an otherwise good tenant, try giving them the benefit of the doubt at first and reach out to them.
Now, that being said, you still need to enforce the lease agreement. If you are lenient about late rent once, don’t be surprised if your tenant is late on it again. So stand firm on your terms and let them know that you will take legal action if they do not pay the rent. Hopefully, the sheer threat of eviction is enough to motivate them to find the funds to pay you. But make sure to document the communication in case you have to take things a step further.
Know Your Legal Rights and Those of Your Tenants
If simple communication does not resolve the issue with your tenant, then the next step is to begin the eviction process. However, as you move into this phase, it is important that you clearly understand your legal rights and the rights of your tenant. Otherwise, the eviction could be delayed. For example, if you notify your tenant of your intent to evict, then accept a partial payment at some point in the process, that payment could void any prior actions and you’ll have to begin again.
Also, as frustrating as it may be that the tenant has not paid, you still cannot enter the home without permission, or harass them for them for the rent. Nor can you shut down the utilities or change the locks. Not only will these things add to the drama of an already unpleasant situation, the tenant can turn around and sue you for them. So remain calm and get a clear understanding of the process including all the legalities. This is important.
Notify the Tenant of Your Intent to Evict
To initiate the eviction process, you will need to give your tenant a “pay or quit” notice. The notice lets them know that they have anywhere from three to five days to either pay the rent or vacate your property. Type the letter and send it via certified mail or through a professional server so that you can document their receipt of it. It should include all critical information such as:
- How many days they have to vacate (put this part in the title).
- Tenant(s) names and property address.
- Amount owed (broken down by month if the tenant is more than a month behind).
- State clearly that the tenant must vacate and forfeit lease after a set amount of days (check your state’s laws for any restrictions on this).
- Give the tenant clear payment details that include the total amount due, acceptable forms of payment, and where to deliver it.
File an Eviction Complaint with the Court
Once you’ve sent your tenant the “pay or quit” notice and have its receipt documented, you can file a complaint with the court if you still aren’t getting anywhere with the tenant. This can be done on your own, or you can work with an eviction lawyer. You will need to gather the following documents:
- Lease agreement.
- Housing License.
- Proof that your tenant received the “pay or “quit” notice.
The court will schedule an eviction hearing and notify your tenant. If your tenant doesn’t show for court, then you win by default and can proceed to evict the tenant with help from your local sheriff. If the tenant does attend, make sure that you have all your proper documentation and think through what you plan to say to the judge. As long as you have followed legal procedures correctly and documented your case well, then there is a good chance the judge will rule in your favor and you can move forward with the eviction.