Would love to hear suggestions on what you've done to help reduce Bad Debt

Hi! Would love to hear suggestions on what you've done to help reduce Bad Debt. In other words, other than evictions, have you offered any incentives to residents owing large balances? I.e., Discount to move, help pay for their move, etc. What has worked for your property? Thank you!

In the first quarter we offered a pay for pay for every $500 paid up to $2000, we matched it with a write-off for the same amount. Out of 498 apartment (not all were delinquent) we had about 20 residents participate and it made a big impact for us and them.

Honestly, in my opinion, WAY TOO MANY Companies have gotten so lax in their qualifying policies that people no longer care about their credit. So many properties now work with broken leases and bad credit, depending on the Class of property it wont matter.

I’d like some half glass full ideas   but I agree with you. Qualifying standards have been adjusted for some properties to accommodate prospects that would otherwise not qualify.

 I work for a company that insures leases so that you don't have to adjust your qualifying criteria and open yourself up to more risk. Residents pay our fees and you get a no cost solution to reducing and managing bad debt. 

We have tightened up our qualifying. Better to have a vacancy than a deadbeat tenant.

Payment plans written out signed by all with clause miss a payment automatic full payment due or 3 day eviction

Usually 3 months because they have to current rent piad

Our PM has virtually collected almost all past dues. Except the two who one a plumber who earned 6k a month but didnt pay because we couldnt evict him and another who lost his job but could not get assistance because he made too much money.
My pm met with people individually and explained to them the danger of gojng to court and how a judgement would effect their credit and future housing. She worked out paymEnt plans according to the persons Ability to pay. Some is extending into 4 to 5 years. Everone on payment plans is paying regularly. Only dis agreement i have is that shes doing all these interest free. I trust her judgement so we go with her recommendations

Wow! Thanks for the info! Pretty generous payment plan on the 4-5 years!

My PM now is researching past tenants who skipped last months rent and left and as business decision , we did not persue because we did not know where they went. My PM has found several of them on Face Book and contacted them to collect last months rent. I dont know how successful shell be. She has the contract and ledger. Thats why, MY PM ‘s year end bonus is almost half her salary.

That is basically what I did at the last property I managed with huge success ! Only 1 through the courts evictions in about 4 years - even through the craziness of covid

Payment plans, both current and past residents. I have them sign a contract for past debt if they miss a payment it's due in 10 days in full for the past people

No one has take advantage of it

Hey there! If you partner with Flex we will pay your resident's rent to you fully guaranteed on the first of the month and work with your resident to pay us back on a more flexible schedule that works with their payday. We assume all risk and report positive credit for all Flex users. No changes to your lease language, $0 to the PMC, no hidden interest or fees to your residents. Feel free to reach out to me [email protected]

Rhino