How to deal with a tenant struggling financially?

Every landlord desires good quality tenants who pay their monthly rents on time and behave nicely. But if you put on the shoes of one of your tenants, you will find that living as a renter has become so difficult with rising rents. More and more tenants are feeling the brunt of rising prices of commodities and rising rents. However, as a landlord, you have to remain concerned with getting timely payment of your rent.

You have clearly told your tenants you expect them to pay their rent on time. You have also told them that they should expect action form your side if they delay their monthly rents. But you are going to face tenants who are facing financing problems every now and then. Here is how to deal with such tenants.

Do not be too harsh

Anyone can face a financial emergency in his life. You are a landlord not a tax man to behave strictly with your tenants all the time. Your goal is to get your tenant but you need not be rude to your tenants. You can remind about delayed rent but do it politely without being too harsh.

Talk to the tenant about his problem

It is not that all tenants are trying to fool you by giving an excuse of a financial problem. Your tenant might be undergoing a genuine problem. You can know about this problem by talking to him in a honest and caring way. Knowing the nature of the problem will help you in deciding your next course of action.

Do not wait and linger on

You cannot wait for a long time once you know one of your tenants is struggling financially. Not taking any action will only compound your problem. If you think your tenant will be able to overcome his problem, you can wait for some time. If not, you have to be ready for decisive action. Ask for a commitment verbally or through an email to have hope of recovering your rent in future. Reply to his mail after sometime asking if his issue has been resolved or not.

Compel him to take action

Many tenants, when they are facing financial trouble, slump into inaction thinking their problems will resolve on their own. You need to talk to such a tenant and tell him that his issue will not go away if he does not take any action. If his job has been terminated, he has to get up and apply for a new job. You can suggest him ways to overcome his financial problem. If he is not thinking of alternatives, he will not be able to pay your rent.

Ask tenants to leave

This is probably the hardest option to present to a tenant who is struggling with his finances. But you have no option as you are a landlord and your business is dependent upon rental income. If you allow him to stay any longer, your losses will add up. If you believe tenant will not be able to solve his problem, it is better to ask tenant to leave.

Offer some cash as incentive for leaving

It may not be easy for a tenant to move out when tenant has no money as it will be impossible to find a place for living. You can give your tenant some cash as a motivation to leave your premises. You can also pay the rent for a truck to carry his belongings to a new place.

Set a deadline if they are not moving

If your tenant does not agree to move out despite an offer of cash, you can tell him that you will get him evicted through legal means. Give him a deadline for leaving and tell him to be ready for consequences.

If you’d like to talk more about property management, or you need help with Everest Property Management, please contact us at Everest Realty. 

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