Minimizing Late Rent Payments

 

How to Minimize the Risk of Late Rent Payments

On-time rental payments are the hallmark of a healthy landlord-tenant relationship. When your tenant pays their rent on time, it is an indication that they are financially stable and respect the terms of their rental contract. In contrast, late rent payments can indicate a number of potential problems, from one poorly timed paycheck to a slippery slope of financial instability. 

Late payments also pose a challenge for landlords when maintaining a steady cash flow and a good relationship with your tenants. No one wants to have to chase down rent, so what can you do to minimize the risk of late rent payments?

 

Accept a Wide Range of Payment Options

First, make it easy for your tenants to pay their rent in whatever way is most convenient. When rent can be paid the same way youre tenants handle their other bills and online shopping, it is more likely to be taken care of during each person's usual monthly routine. However, as we live in such a diverse and digitally hybrid world, each person's preference and routine may be a little different.

Popular payment options include:

• Credit card
• Debit card
• Digital wallets (ex: ApplePay, GooglePay, PayPal)
• Paper checks

Your best bet is to set up a tenant portal that accepts online payments using a conventional payment processing service that will be familiar to anyone who shops or pays for services online.

 

Enable Auto Payments

Auto-pay is a life saver for the busy and absent-minded. Many tenants don't mean to miss rent, but life is busy and monthly tasks are far apart. Auto-pay enables an automatic transfer from the tenant's bank account or credit card every month. 

Essentially, auto-pay is a rent subscription. Tenants that have many subscriptions or are familiar with auto-paying bills often prefer to put their rent on a timer instead of remembering to pay it manually each month.

 

Screen for On-Time Payment History

It's also important to select tenants with a positive payment history. When choosing future tenants, select applicants that appear to have a financial history of on-time payments and well-managed credit accounts. These are indicaators that a person is generally able to pay their bills on time through both financial security and personal responsibility.

 

Clarify Late Fees and Penalties

Let your tenants know that there are penalties for late rent payment from the outset. Include late rent fees in the lease contract and mention the late fee when you go over the terms with a new or prospective tenant. There's no need to stress the issue, but ensure that your tenants see and understand that a late fee or certain penalties will be enacted if they are X number of days late with the rent on any given month.

 

Provide a Small Grace Period

While a late fee can discourage careless late rent payment, it's also helpful to provide a grace period. A grace period is typically a few days after the rent date in which a payment can be late without penalty. Grace periods are useful to maintain good relations with well-meaning and responsible tenants because, as we know, delays happen.

• Some tenants are paid on a specific day of the week, which doesn't always align with the first of the month.
• A tenant may be paid on a bank holiday and unable to cash their check until a day or two later. 
• A server error may delay or fail to send their payment.
• A tenant may forget everything during a personal emergency or special holiday until next Monday rolls around.

The typical grace period is 5 days, but you can adapt your grace period based on what seems practical.

 

Send Reminders to Forgetful Tenants

Landlords have also had some success reminding absent-minded tenants a few days before rent is due. You can easily set up an automated message routine that will send an email or text message to tenants to help them remember to pay on time. This method is particularly useful when renting to students and other young populations who may be new to renting and responsible monthly routines.

 

Manage Every Tenant's Rental Schedule with Leaf Management

Reducing the risk of late rent benefits from a comprehensive approach and, sometimes, a personalized solution. The more properties you own, the more important your late rent prevention strategy becomes. Leaf Management can hel you balance the needs of your operating balance with individual tenant payment schedules. Contact us to explore property management services.

Property Issues to Expect Amidst Winter

 

The 7 Biggest Rental Property Problems You'll See in Heavy Winters

When you own a rental property in a wintery climate, be prepared for winter maintenance calls. Tenants rely on the tenant-landlord partnership to help keep the property warm, safe, and in livable condition despite the winter's best efforts. Heavy winters involve deep layers of snow, ice, far-below-freezing temperatures, and strange moisture issues. 

Hearty winter-region tenants will often be able to navigate many of the routine tasks like keeping the gutters clear and shoveling the driveway, but there are a number of tasks and maintenance issues that you'll want to address and plan for as the property owner.

 

1) Not Enough Hot Water / Water Not Hot Enough

Water heater troubles are a known issue in the deep winter. As the ambient temperature drops, water heaters struggle to get the tank to hot temperatures. Cooler air temperatures around the tank and colder water entering through the intake pipe both make up part of the problem.

If your tenants call regarding not enough hot water or their water is not hot enough, there are two likely solutions and enacting both is a good idea.

• Flush and service the water heater - send a maintenance service to flush, clean, and tune-up the water heater. This can help you pre-empt leaks, pilot light problems, and temperature sensor calibration issues as well.
• Wrap the water heater - Apply a special insulating blanket designed for water heaters to help keep the water warmer and safe from winter temperatures.

 

2) Plumbing Problems: Clogs to Burst Pipes

Cold weather often brings plumbing problems. Clogs are common because materials tend to congeal in the cold and are more likely to form a clog instead of flowing away. In extremely cold weather, pipes can even burst when the water inside freezes.

You can reduce the risk of both problems by insulating the pipes in your rental homes, especially in unheated spaces like the basement, attic, and crawl space. But it also helps to keep a plumber on call for winter clogs.

 

3) HVAC Heating Problems and Cold Drafts

Cold drafts, not enough heat, or the HVAC heater not working are crucial problems for your rental property during a heavy winter. It is your responsibility to keep your tenants warm with a working heating system.

For cold drafts:

• Caulk up the windows
• Reinstall weather stripping
• Seal cracks
• Add insulation to the attic
• Have the HVAC air-balanced

For HVAC heating problems:

• Send an HVAC service in the autumn before the hard winter sets in. Have them clean and tune up the heater.
• Be prepared to send an emergency heating repair service at any time, day or night
• Provide supplementary heating like firewood and battery-powered blankets during heating or power outages.

 

4) Leaks from Roof to Foundation

Heavy winters mean tons of snow and ice, which can lead to unexpected moisture problems. During the daily light melt and re-freeze cycle, puddles can cause problems for your foundation, while piled snow can cause problems for your roof.

Make sure your gutters, roof, and attic are in top form and ready for winter before the snows, and take steps to protect your foundation from winter moisture seepage. Foundation coatings and barriers are a popular choice.

If a maintenance emergency occurs mid-winter, have reliable contractors on-call who can do winter repairs.

 

5) Fallen Tree Limbs

Heavy snow can also wreak havoc on your trees. One of the most disastrous problems for a rental house is fallen tree limbs broken by heavy snow. Tree limbs can do serious damage to your roof and siding depending on the size and placement of the limb.

Trim trees so they don't overhang the house during warmer seasons to prevent fallen tree limb damage. If a tree limb falls during the winter, call for emergency repairs depending on the type of damage that was done.

 

6) Blocked Fireplace Chimney

If your rental house has a fireplace, you can bet that your tenants will test it out in the winter. Fires are cheerful, warm, and add to holiday cheer. But first, the chimney needs to be clear. From a hard-to-see flue control to birds nesting in the chimney, don't be surprised if tenants call to request maintenance so the fireplace works correctly.

If you're lucky, your tenants will know how to check before they light the first fire.

For homes with a fireplace, consider scheduling a chimney inspection and provide a quick guide to working the flue before the temperature plummets too far. Providing seasoned firewood can also help encourage only burning clean and advisable fuel.

 

7) Outdoor Wood Rot

For homes with a deck, porch, balcony, or wooden fence: watch out for winter wood rot. The moisture and cold combined can acellerate wood rot in the winter, leading to loose railings and crumbling deck boards. Sealing your deck and other outdoor wood assets in the summer is the best way to prevent the risk of outdoor wood rot during a heavy winter, but you can also advise tenants to regularly sweep the deck and clear heavy snow from the balcony.

 

 

Handle Winter Rental Maintenance with Leaf Management

Preparing a rental house to keep your tenants safe through heavy winters requires careful planning, and handling winter maintenance emergencies is a must. Gain the benefit of a team that understands winter climates with the help of Leaf Management.