Late rent payments cause a lot of frustration for almost all landlords (we’ve previously written on what to do with habitually late rent payers.) You can make collecting rent a breeze, as well as minimize late rent payments with proper tenant screening techniques (see our tips on that here), and by following the quick tips we outline below:
This is one of the more important action items. The first of the month has a tendency on sneaking up on everyone, so a friendly reminder can go a long way in curbing late rent payments. It’s fairly easy to get in touch with your tenants (whether its by phone, text message, or a flyer in the hallway.) You can use free tools such as boomerang for gmail to schedule emails to be sent a few days prior to the due date, and it’s easy to set up.
Our software (yuhu) sends tenants email reminders (with their total rental amount owing) twice before the rental due date so you don’t have to!
Be Firm When Collecting Late Rent
If the tenant is late repeatedly, it’s important to confront them and try to find the root of the problem. Not confronting tenants on late rent collection can reinforce their bad habits, or make them think it’s “ok”. You should make sure not to approach them in an aggressive manner, and to always be respectful. A little bit of extra communication can go a long way!
Outline your Policies for Late Rent
It’s important to clearly outline your late rent policies to potential tenants (and remind those who forget to pay on time). Most landlords have a late rent fee (~$20), with the potential to report the late rent payments to credit bureaus after a certain period of time has elapsed. It’s important to show the tenant (and prospects) how serious you are for on-time rent collection.
We believe everyone deserves a second chance, so if they have only missed one rent payment, goodwill from waving that late rent payment can do wonders for both your brand and landlord-tenant relationships. Make sure they know you are doing them a favour for waving the fee, and next time you will have to enforce the rules (as outlined in their lease).
In Ontario, most landlords send their tenant an N4 form two to three days after the due date. These are important to submit as soon as possible as it initiates the eviction process (which is fairly lengthy in Ontario.) Most N4 forms are met with prompt rent payment. Use your best judgement in all scenarios (some tenants might just be having a bad month) – be fair, but firm.
Give your Tenants Options
Making it easy to pay rent reduces the “dread” in having to pay rent for your tenants. Many smaller landlords accept INTERAC e-transfers as payment, or sign up with the banks to allow their tenants to find and pay them through their online banking portal. Promoting automated payments (direct debit/pre-authorized debit) removes the ambiguity from collecting rent (i.e. when its due or for how much) and removes human error (no more forgotten payments or wrong amounts.)
Let our Robots Work For You
You can use a platform like yuhu to do the heavy lifting for you. We automatically send rent due reminder emails to your tenants, provide them with online methods of payment (debit/credit cards, preauthorized debit), and provide your tenant with a 14-day eviction notice if rent has not been received. That’s just a few of our many time (and money) saving features.
Feel free to email with any questions at [email protected].
If you are looking for an easy way to manage your rental properties online, visit us at www.yuhu.io. We make lease generation, online marketing, payment collection, and managing your rental units as easy as clicking a button!