The dreaded late rental payment. If you have a great tenant that pays on time every month like clockwork, you may not have had any experience collecting late rental payments. Even the best tenants can sometimes slip up, life is hectic, and a one-off forgot payment could happen. When it does happen, don’t fret. Consider using the following information below how to collect late rental payments.
Step One: Refresh your memory on the terms of your lease agreement regarding late payment.
If you are a self-managing landlord, you may likely have a lease agreement from Rocket Lawyer, Legal Zoom, or one you got from your buddy that he’s used for years. Regardless of where you got your lease agreement from (not advising any of the above), the lease will outline the penalty if rent is not paid on the due date. It is important to know if your lease provides a grace period for the tenant. The Grace Period is the period of time or number of days the tenant has to submit payment with a penalty, typically between 3 - 5 days. Read the terms of your lease agreement. Determine if you will provide a grace period for your tenant. Also, check your State Law on how much you as a landlord can charge for late payments. Check out this great interactive map from Sparkrental of how much landlords can charge tenants for late rental payments by State. What is your State limitation?
Step Two: Post your Three Day Notice To Pay Or Quit/Vacate.
After the grace period, the three-day notice to pay or quit should be posted in accordance with your lease and State/local Law. We recommend that you use a process server to ensure the notice is served properly to your tenant. If you're self-managing out of State or from a distance from your property, definitely look into a process server. Look into Accurate Serve, here in Central Florida/Orlando, reach out to Lynx Legal Services. The whole tag and bag, post notice and run, in Florida does not fly. You need to knock, and if no one answers, posts the notice on the door. We take photos of the entire process. Our process is to not display and showcase the 3-day notice to pay or quit. Life happens, and financial situations occur, we suggest an open line of communication. However, if your communication is not open and clear, the best option is to get your message across to ensure it doesn’t happen again.
Step Three: your tenant does not pay.
After all attempts have been made, with quality open communication, a notice posted, and still no avail. It’s time to pursue evictions. It’s important to know the steps of an eviction and how to prepare yourself for eviction. If you need assistance with management or collecting rent with your Orlando or Central Florida Rental property, please don’t hesitate to reach out to The Listing Real Estate Management. We love to hear your story.
Bonus: Payment Gets Reversed Or Check Bounces.
First note, do not accept cash rental payment. It may be enticing and easy, but the paper train is crap and non-existence. Second note, if you are self-managing and have the capability to accept online payments and the payment gets reversed. Turn off the online rental payment and only accept certified funds or money orders. Your tenant should not be able to submit rental payment month after month with a reversal of non-sufficient funds. If it happens once, require your tenant to submit funds via certified funds or money order.
Final Thoughts as a Property Manager
It’s never fun being the bad guy. You won’t have to be Henry Hill with the family going over collecting rent. Collecting late rent is never fun, but if you have a quality Orlando Property Management Company, you won’t ever have to worry about it. The Listing Real Estate Management is at your service; we are happy to be a resource for you in any way possible.