The current economic climate is challenging for tenants and landlords alike. With millions of Americans out of jobs and unemployment claims rising, more people are having trouble paying rent. Unfortunately, this has also impacted landlords, who must pay their operational costs on time.
Landlords are in a bind — on the one hand, they can’t waive rent forever. On the other, they don’t want to be the villain of this tale. If you’re a landlord in such a situation, perhaps the following tips can help:
1. Partner with an Ethical Collection Agency
Many landlords hesitate to use collection agencies, especially now, because of the reputation of some debt collectors. If you have such concerns, consider using an ethical collection agency that takes a diplomatic approach and has years of experience collecting rent.
The right agency will achieve results without breaking regulations or damaging your reputation as a landlord.
2. Look Up the Latest Rules
Make sure that you look up the latest rules before taking steps to collect rent from tenants who are behind on payments. If you don’t know the laws, you might make an offer that’s banned by your city. For example, it’s illegal in many localities to ask a tenant to sign a payment plan document. Likewise, you can’t evict your tenant if evictions are banned in your state.
3. Communicate
Even in normal times, a good landlord must keep all communication lines open with their tenant to avoid unfortunate circumstances. During a pandemic, it’s especially critical to be receptive to a tenant’s concerns in order to avoid unpleasant surprises down the road.
If your tenant suspects that they may have trouble paying rent, ask them to give notice. The documentation you receive from a tenant will come in handy later.
4. Be Flexible
This is the time to be flexible. If you’re not facing financial problems, consider giving your late-paying tenants a break until the crisis passes. If your tenant has lost their job, then look at their history. A tenant who has always paid their rent and utility bills on time, treated your property with respect, and reported maintenance issues before they develop into costly concerns, is more cost-effective to keep in the long run. You don’t want to replace your good tenant with a less reliable one in this challenging climate.
5. Find the Right Balance
Although it’s vital for you to be compassionate, it’s equally important to avoid scams. If your renter lost their job or work hours, then they may deserve your cooperation. However, some tenants are reportedly taking advantage of the situation and refusing to pay rent even though their economic situation remains unchanged. Verify the facts if you can before youoffer flexibility.
6. Get Relief
Ease the burden on yourself by contacting your financial institution and asking for mortgage deferrals. Don’t hesitate to ask your other creditors for flexibility if you need to. You may also qualify for disaster relief funds for your rental property business from the government.
In these extraordinary times, you need to be flexible, communicative, and open-minded to survive as a landlord. For the fastest results, get professional help from an ethical collection agency.
What did we learn?
