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Property Management | Leesburg Landlords: What to Do When Renters Don't Pay

Posted by Gunn Property Services on Jun 4, 2020 7:30:00 AM

No matter where you live in the fine state of Florida, a crisis can create worries that tenants will fail to meet their obligations—especially when it comes to making timely rent payments. During a time of widespread unemployment and difficulty finding one's next job, non-payment is a real possibility. However, as your guide to property management, Leesburg landlords, we know this isn't a time where you can only sit around, hoping that the rent will be paid.

Businessman with piggy bank and coins at office

Instead, you can take this opportunity for proactive communication with your tenants to build a strong rapport, understand where they are coming from, and ultimately feel confident in your choices down the road—even if that sadly leads to eviction when other methods fail. The key is never letting small misunderstandings or a collective crisis be the reason you terminate a relationship with an otherwise reliable tenant.

Often, building rapport and goodwill can be a path to a long-term, working relationship that benefits both you and your renter! Here are some of the tips we've gained during our time as an expert in property management, Leesburg landlords, that you can put to work for you.

Please note: This blog is not intended to act as legal advice. When in doubt, reach out to your skilled attorney or the best property management Leesburg offers! Gunn Property Services is proud to assist and support property owners during these troubled times.  

Open Communication—and Document Everything

The first thing you should be doing in a crisis is opening up communication with your renters. You should have been staying in contact with them now and again before this point, but if you haven't been, this is a great time to get started:

  • Outline that you understand we're all working through the aftermath of COVID-19 together, as a community.
  • Detail any changes to how you plan to approach maintenance, inspections, or other services as a landlord.
  • Mention how you rely on rental payments too as part of your income, and that you're working on solutions.

One of the ways to keep your communication with tenants civil and positive is to focus on these very solutions. However, as you do, you'll want to document the feedback your tenants are providing.

If they have already decided they have no intention of paying rent or making up for their past due balances, their responses to your questions and queries will be crucial in a future eviction proceeding. Ideally, by documenting any communication surrounding rent, you can touch base when tenants say they will be able to pay rent or that they may need help.

At this point, you may be able to resolve the situation and move forward. However, you'll be glad you documented everything in that rare case where a tenant persistently breaks his or her word.

Show Compassion Without Breaking the Existing Contract

The tough part about people struggling to pay rent is that they often are truly caught up in something beyond their control, and of course, you want to be as compassionate as you can with your overhead in mind. However, many property owners have suddenly found themselves in the same boat as their renters—and if you can't afford to pay the mortgage, everyone loses.

  • Make sure you are being understanding of current circumstances and hearing out your tenants about their cashflow problems while emphasizing (if you're comfortable) your own.
  • If their issue is not having received an unemployment check, for instance, you can work with them on the timescale that your finances and their finances will support.
  • Let individual circumstances determine your leniency, but try not to set up a precedent that rent is canceled whenever hardship arises unless you can afford to take that stance.

Business man showing his empty pockets

Develop Payment Plans That Work for Both Parties

If tenants are slowly getting back on their feet after a crisis, a payment plan that gives lots of space at first and slowly ramps up payments over time can be a good way to retain a great renter who fell on hard times. If the tenant fails to pay rent this month, talk to them about what partial payment they can swing right now, and how much they can add per month to future rent payments to eventually pay it off.

This is a good way to attune your offer to your tenants, without giving them the belief that they can avoid a rent payment on a contract that they signed. However, you should always be sure to get any such agreements between you and your renters in writing.

If Circumstances Don't Improve, Move to Eviction After It's Legal

While many tenants are genuinely struggling, there will be one or two who are using the chaos of a crisis to mask a desire to simply not pay their rent. You may realize, in the course of your documentation, that a tenant has not kept his or her word multiple times—failing to get you even the reduced payments they agree to pay.

If this is the case, your provider of property management, Leesburg landlords, may have advice on when and how to legally pursue eviction after the crisis subsides. You'll save money and be more prepared for a positive resolution if you follow all the legal guidelines in your area and give the tenant ample opportunity to shape up or move out. 

Working With a Partner Can Relieve Your Stress

That being said, evictions and even rent collection can be stressful—especially if you have an eye to expanding your investment property portfolio. Choosing only the best property management Leesburg has to offer can free you from responsibility if you'd prefer to be a hands-off landlord.

Property managers are experienced in working with tenants who are struggling to pay rent, and have a variety of ways to communicate and tailor a solution specific to each renter! When you choose Gunn Property Services, you're making a choice that ensures rent is paid on time, and the right connections are built with your tenants—even when they need time to gather their resources. Reach out to us to see how we can put our skills to work for you!

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Topics: Rental Property, Property Management (Leesburg), Renter Relationships