Becoming a property owner may seem like an effective way to take care of yourself and your old age. From the outside, you buy a property, find someone to live in it, and they pay you every month. It seems like a good deal. But what happens when your renters refuse to pay? What happens when the rent falls behind and it becomes a running bill?
If you are a property owner who rents out your building, Ben, listen up. Here’s what to do if your renters refuse to pay.
Why wouldn’t my tenant pay rent?
When someone moves into your property, you and they enter a contract. You have an agreement. They get the use of the property, and you get a monthly payment that accounts for the costs you incur and the wear and tear of your property. But there are all sorts of reasons why a tenant may fall behind on their obligation and be unable to pay.
Let’s face it; tenants rent properties because they usually can’t afford the loans to buy the property for themselves. This means that you must assume any renter will be financially less stable than yourself. Someone who’s less economically sound than you doesn’t have the same financial resources that you do. Most people who rent out their homes are only ever one or two paycheques away from poverty.
Therefore, we can imagine that if our tenants were to lose their job, that would impact their ability to pay monthly rent. What if they’ve had a family death and they’ve simply forgotten to pay? They’ve had a family death, and that family member was the person who paid the rent. All these circumstances can amount to a tenant who is unable to meet their end of the contract.
What do I do when my tenant pays rent?
If you find yourself in this situation and your tenant cannot pay you, then it is up to you and them to discuss a repayment plan which suits both of you. First, you should try to speak to them in person if possible and remind them of their obligation. If speaking to them in person has no effect, you should move on to the formal process of notifying them in writing that you require payment. You can even invite them to come up with a payment solution that they can afford.
If you have tried all the above methods and aren’t getting anywhere, then hiring a debt recovery lawyer Is the next step. These are specialists trained in negotiation and diplomacy. First, they will send a letter of demand which is as it sounds. This letter demands that your tenant pay you the sum owed. The lawyer will then negotiate with the tenants’ representatives on your behalf, and they may even take them to court.
What about my tenants?
What does this mean for your tenants? If you must take someone to court for refusing to pay their rent, it is doubtful that you’re going to keep them living in your property for much longer. Remember to factor in life events and occurrences which are unavoidable. Don’t be too quick to throw people out.