At some point, nearly every property manager out there will end up having to deal with certain things. Repairs are a good example of this, as is developing a solid marketing strategy. But another thing that will need to be dealt with is late rent. Eventually, you’re going to have someone who just can’t make their rent on time. 

While a single instance may not be a huge deal, especially if you end up collecting a few days later, there are a lot more problems with late rent than many may realize. Taking a closer look at just how late rent can impact your efforts to properly manage properties is well worth doing. Here are some things to consider.
 

•    Losses Over Time – Every day that passes without rent, you’ll end up losing not only money due to the lost rent, but also money in terms of what you’re paying employees to try to collect. Even if you’re handling the collection process on your own, you’ll end up quickly spending more time than you should on trying to get your money. Time is valuable, and losses add up quickly. 

 

•    Legal Fees – If you end up having to take legal action, you’ll spend a tremendous amount of money on the process. Just the filing fees alone can add up quickly, and the bottom line is that collecting rent can often end up costing far more than the actual rent itself.

 

•    Example – What about other occupants? If one is consistently late without repercussions, what is stopping those other occupants from feeling that they can do the same? Even if 95% of your residents pay on time, that 5% can add up quickly. 

 

•    Immediate and Long-term Loss – The immediate loss on your rent income is obvious, but that can quickly add up. Being behind on one month means that the resident now has to play catch up, and it’s common for them to never really manage to do so. In short, a single month of late rent can quickly turn into a consistent problem you’ll have to address. 

 

The bottom line is that late rent is a very serious problem and one that you need to understand fully. Failure to take it seriously or to ‘let this month slide’ can lead to long-term consequences that can’t be ignored. And the loss of time that is spent trying to collect means that you’ll end up losing even more than the initial rent amount. To learn more about collection tips and how to prevent these problems – and to get additional guidance in all aspects of property management – contact our team today.