Late Rent and Lease Renewals

I would love to hear how you might handle this situation.

If you had a problem tenant that is constantly late on rent with accrued late fees still outstanding with less than 60 days left on their lease agreement what would you do?

I would non renew their lease.

Definitely non-renew.

Laura Myers wrote: I would non renew their lease.

I agree. Make sure you're within your local laws in doing so, then give them a timely notice of intent to non-renew the lease.

I would not renew their lease and our late fees have to be paid at the time they pay their rent.

We require everyone to pay their late fees at the time of rental payments. If not included we do not except the payment. If they are habitually pay late we give them a non-renewal along with a notice to vacate at the end of their lease.

Definitely non renew. Late rents cost the company money and affect bottom dollar. I like to know I have tenant who are going to pay on time.

I would definitely ensure that we are within Fair Housing Laws. Depending on their other criteria:
do they cause problems
do they care for the apartment
lease violations

Maybe there is some way to get them on track to paying on time.... like auto pay, or splitting their rent at the end of the month and on the 1st and tell them to set some pillow money in their rent account if possible.

Do you see any improvement in late paying tenants with those paying online vs. paying by check?

Once we began to encourage online payments, we have seen an increase in on-time payments. We reward tenants to sign up for autopayments, and we also give a $250 rent concession at lease renewal if they have had 12 months of on-time payments. This has helped to dramatically increase payments on time as well as reduced rent collections.

A lot of property companies have found that working with residents to get caught up on rent and/or late fees in arrears can be helpful as a condition of renewal. For example,, an otherwise reliable resident always pays but always pays late. It's bad for the resident and bad for business. If you'd rather avoid turning a unit, you could require a creative payback plan as a condition of renewal. Here's what we've seen work: 1) require payment of 50% of what's owed; 2) allow three months for the resident to get caught up with rent from payroll - a platform that receives prorated deposits every pay period from a resident's employer before money hits their paycheck; 3) waive additional late fees while the resident is participating in the payback program. Most companies require the resident to stick with rent from payroll throughout the tenure of their renewed lease or owe whatever late fees were waived during the payback period.

I would send them a letter reminding them that their lease is coming due. I would remind them that a renewal is only granted to residents in good standing. I would also emphasize the importance of a rental reference for future housing needs.

Thank you everyone for your insight! It's seems the majority is leaning towards a "non-renewal" notice. I would have to agree with the majority on this.

Btw we have implemented on-line payment options, and I do have to say that payments in general have come a lot sooner in the month. I'm not saying that it has curbed tenants from using all of the grace period or paying late, but what I am saying is that an on-line payment option seems to have quickened the ability to collect sooner in the month. Hope that makes sense.

Also, would anyone be willing to share a copy of their "non-renewal" document?

Paul