As you are undoubtedly aware, owning rental properties is a fantastic source of income and provides for potential asset gain. However, like with every other investment, it is not without its difficulties. The most painful challenge for most landlords is renting a home to a bad tenant that stops paying rent or consistently pays late.
When you rent to a bad tenant, it can impact your time, cause stress, and hurt your business. For example, consider a renter who hasn’t paid rent for two months and pays rent late consistently. While this may be irritating and stressful, it impacts your business income.
Rent is what keeps your business running and growing. If a renter fails to pay rent, you face a critical situation as the landlord or property owner.
Is your renter failing to pay the rent? What happens next? In today’s post, you’ll discover what you can do if this occurs.
How to Cope with Tenants That Are Not Paying Rent
Maintain Meticulous Records of all Rent Payments
A landlord’s job is not easy, especially when managing multiple properties. Having said that, it’s always crucial to keep tenant records up to date.
Keeping proper records of tenant rent payments will allow you to quickly check to see if your tenant is up to date on their rent or if they are behind.
Additionally, it is critical to retain the appropriate documentation if an eviction is required. All documents will aid your eviction case against a tenant.
Review the Rental Contract
Before you rent out a property, it is essential that you review your rental contract. Review the agreement to ensure that it contains all necessary language to safeguard your property, including information regarding paying rent.
- Monthly Rent: Rent control communities do not exist in Missouri. As a result, landlords do not have any regulations on how much they may charge for rent.
- Types of Payment Accepted: Include the types of payment that you will accept for paying rent. This may include cash, check, credit card, money order, as well as online payment options such as Apple Pay, PayPal, Venmo, Zelle, etc.
- Due Date of Rent: Unless otherwise specified in the lease, rent is usually due on the first of each month. The rental agreement should include policies for when a due date occurs on a weekend or a holiday.
- Where to Send Rent Payments: Include the address for where your tenants should send their rent payments. It might be the landlord’s company address, for example.
- Rent Payment Grace Period: If you have a grace period for paying rent, make sure you include this information in your agreement.
- Consequences of Late Payments: Failing to pay rent or paying rent late may include consequences such as late fees or eviction.
- Fees for Bounced Checks: If a rent check bounces, there are additional expenses. If you are charging the tenant, it is your responsibility to include this information in your rental agreement.
- Notice of Increase in Rent: If you determine that you need to increase the monthly rent, you must provide a notice of your intent.
Keep detailed records of each action you take after determining that the renter is in default of paying their rent. They might be instrumental if matters go to court.
Send a “Pay or Quit” Notification
When a tenant falls behind on rent, several jurisdictions, including Missouri, compel landlords to issue a pay or quit notice.
The notice to pay or quit essentially informs the renter that they have a certain number of days to pay their rent or evacuate the home. In Missouri, landlords are required to give the tenant at least five days. If the tenant does not heed the notice for past due rent, the landlord can file an eviction suit in court.
Take Legal Action
If everything else fails, the next step is to hire an eviction attorney. It is important to remember that to evict a tenant; the landlord must follow the letter of the law. The first step is establishing a legal reason if it comes down to eviction. In this scenario, the legal reason is that the tenant is not paying rent. Following that, you’ll need to fill out the necessary papers at your local courthouse. Bring the “Pay or Quit” notice with you because the clerk will request this documentation. Finally, you must appear in court on the scheduled day. It could be two weeks or several months after filing the paperwork before the court date. If you are successful, you will need to enlist the sheriff’s assistance to evict the renter.
When dealing with a renter who pays late or partial rent, some landlords advise doing a walk-through inspection of the property as soon as you are able to ensure that your property is not being damaged. You can typically only access the property with the authorization of the tenant.
Once the tenant has given you permission to enter the property, it is advised that you document and photograph wear and tear and damages. Once you have identified issues, repair the damages and request the renter fix anything that is their responsibility. Plan another inspection to ensure all parties have resolved the issues and keep all papers in case they are required in court.
Hire an Experienced Property Management Company
We hope you found our article on what to do if your tenant stops paying rent helpful.
Dealing with tenants can be time-consuming and stressful, and if dealing with tenants stresses you out, it’s time to contact Real Property Management Consultants. Our team of experienced professionals will take care of everything for you – from rent payments to repairs and maintenance. So, give us a call today at 816-207-0750 to find out how we can help or to get started!
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