In property management, one of the foundational concepts is that of rent collection. It's a straightforward transaction: a resident is given permission to live on a property in exchange for paying a fixed, recurring amount at a regular, repeating interval.

While that expectation normally plays out according to plan, there are sometimes instances where a resident can be late in paying rent. In some situations, the lateness may even become chronic, verging on consistently late payments—but ones you still receive—to payments that are missed entirely and start falling behind month after month. Here are a few of the things you can do if late payments become a problem.

Document Everything

First and foremost, it is important to make sure that your legal and financial activities are recorded and verifiable. It's crucial that you are able, if needed, to furnish records showing due dates, missed payments, late payments received, and communications that may have occurred between you and the resident. The communications, in particular, are important if they document any admissions of late or missed payments. While it's always the hope that none of these materials will be required, if you ever have any need of legal resolution, such as going to court, or even needing to resort to an eviction notice should everything else fail, all this evidence backs up your claims and reinforces the validity of any actions you take.

Reviewing Agreements

In a similar vein, it can sometimes be important to take time to review a lease or rent agreement with a resident. This can be especially important if you have any conditions or contingencies that you want to reinforce. Elements of an agreement, such as potential rules for late payments, penalties such as late fees, and others, can be reviewed and repeated at this time to ensure residents are aware of their obligations.

Maintaining Professional Communications

In keeping with the previous two points, it is also important to undertake these actions with a carefully maintained line of communication that remains professional at all times. When payments are late, it's expected and fiscally responsible to reach out and try to resolve the issue. However, this must be done without being emotional, argumentative, or confrontational.

In the same way that employees in a work situation respond better to professional communication rather than accusatory or emotional interactions, the same is true of residents.

Be Open To Compromises

It's not unusual for residents to be late on payments due to circumstances beyond their control. Someone paid via a shifting or unreliable payment schedule, may not always get their salary in the time you expect. If you find you're in a situation where someone is consistently paying their rent, but doing it a few days late, for example, then it may be better to shift the expected date of payment.

For example, instead of collecting payment on the first of the month, it may make sense to compromise and push the payment date to a week or even two weeks later.

If you want to help ensure your residential property activities succeed, contact Occupancy Solutions and let us help.