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Stay calm and don’t do anything totally crazy.
In my experience, that is the single most important step when dealing with tenants that are late with rent or have completely stopped paying. While there are many reasons for why rent arrears occurs, the most common reasons are:
- Tenant has lost their job
- Tenant has taken a pay cut (or financial circumstances have changed)
- Cost of living/inflation
- A joint tenant has moved out (for whatever reason)
Unfortunately, dealing with arrears is a constant struggle for landlords and is often considered the most daunting situation due to its potential for financial devastation. It can be bloody crippling.
The reality is, every landlord will eventually deal with rent arrears, and knowing that alone is extremely powerful. Thousands of landlords face this issue daily, so if you’re grappling with it now, you’re not alone. Of course, this offers little consolation because, it’s happening to you.
As a seasoned landlord I’m certainly no stranger to rent arrears, and experience has taught me…
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Right, now back to the regular schedule…
Rent arrears and late payments is never easy to deal with, both financially and emotionally. Alas, as I already alluded to, dealing with it is part of the job, there’s no escaping it, and I don’t even know why any landlord wouldn’t presume it’s an eventuality. It’s not a question of if, but when.
However, being aware of the risks is one thing; knowing how to deal with it is a whole other ballgame. When I read comments and questions like the following, I realise how so many landlords know diddly-dick and revert to their animal instincts, as opposed to following procedure.
Can I move my tenants stuff out when they’re at work?
Is it illegal to throw my tenants out if they haven’t paid rent?
My tenant hasn’t responded to all 30 of my phone calls, what should I do?
No, no, bloody yes, and stop calling… immediately.
And believe me, I read a couple of landlords asking those questions on a daily basis. That’s a whole lot of prospective counter-claims.
Rightly or wrongly so, there are proper channels and procedures to follow when dealing with rogue tenants, and until a tenant surrenders their tenancy or is legally evicted, your property is still their home.
Page contents
- Late Rent Vs No Rent
- Stay Calm
- Accept the realities
- Communication is imperative
- Try offering solutions
- Sending ‘late rent’ notices
- ‘Late Rent’ penalty fees
- Admit defeat when it’s time and get professional help
- Sometimes a loss is a victory (vacating & rent recovery)
- Once it’s over
- Prevention
1) Late Rent Vs No Rent
Is your tenant late paying rent or have they completely stopped paying? There’s an important difference, and how you deal with the situation will vary depending on what stage you’re at!
If your tenant is late, then there’s still time and plenty of opportunity to salvage the situation, and this blog post will cover key areas to assist. However, if that ship has sailed and your tenant has become completely unresponsive and/or has completely stopped paying rent, the only sensible option left might be to admit defeat and start the horrendous eviction process. There’s no sugar-coating that ordeal I’m afraid.
2) Stay calm, don’t act on your ludicrous impulses
If you’re dealing with an unapologetic and unreasonable tenant that seems hell-bent on making the process as painful as possible, it’s unlikely that you’re feeling like your normal self right now – you’re probably unhinged and emotional. Don’t worry, that’s a normal response given the circumstances. But however normal it may be, it also means you might be dangerous, like a loaded weapon. We need to keep in that check, okay?
Unfortunately, when dealing with rent arrears, the relationship with the tenant is likely to deteriorate quicker than a kipper left under the sun. That’s when it becomes easy to let frustration take over – at some point, it becomes less about the money and more about the sense that a turd is trying to take advantage of you despite your efforts as a model landlord. Obviously not always the case, and I think it’s important to make a clear distinguish between tenants who fall into arrears and respond maliciously and those who handle the situation with class.
Regardless of the situation, always stay calm and resist any urge to take actions that could jeopardise your case. You may not be able to control your tenants actions, but you can control yours (well, unless you’re an absolute psychopath). Just be cool; remain rational and patient throughout, and accept that justice will prevail if the correct procedures are followed. If you allow yourself to get thrown off course, you can easily become prone to prosecution, further delays and more costs.
3) Accept the realities of the situation
Once you’re calm and have set aside any thoughts of strapping your work tie around your head and kicking your tenant’s front door down like Rambo, you need to accept the realities of the situation. This is easier said than done, as the realities can be sickening and difficult to accept.
As you become more familiar with the legal process, you’ll likely find yourself feeling even worse, just like many other landlords in your position – because you start to realise there is no quick fix. However, you must set aside your frustration with the perceived injustice and accept the law as it stands, even as stupid and inconceivable as it may seem. The legal system won’t adapt to your situation, so you need to work within its framework.
- It’s emotional: I’ve read many resources on handling rent arrears, and surprisingly, none address the emotional stress it causes landlords – baffling.
I’m not claiming that everything I share here will be more practical or useful, but I do acknowledge the severe emotional toll this situation can take. Besides the financial strain, it’s one of the biggest adverse effects. I know because I’ve felt it. Straight in the solar plexus.
You’ll likely lose sleep over this bullshit; lying awake with overwhelming frustration and concern. While I can’t ease your pain, I want to assure you that these feelings are normal, and that things will get resolved. Just keeping it real.
Allow your emotions to flow, but do not allow them to control your actions.
- Tenants rights: tenants do NOT lose their statutory rights if they fall into arrears or breach any other term of their tenancy. They simply don’t. Your naïve and brittle mind may think otherwise, and you may even believe that stripping someone of their tenancy rights because they aren’t paying their way is the only conceivable outcome. Regrettably, your wet-dream is only that, a wet-dream.
Back in reality, you CANNOT just “kick the tenant out”
Rogue tenants have all the same rights as decent tenants, so they’re still entitled to live in quiet enjoyment, which means you can’t harass them in any shape or form, which includes making unannounced appearances and flooding them with phone calls, text messages or letters.
- Slow process: late payments and arrears rarely get resolved quickly, so accept that this could take time to resolve. Truly frustrating.
- You’ll lose money: there’s a good possibility that by the time this is over, you’ll be out of pocket in some shape or form (even if you have landlord insurance that includes Rent Protection and legal expenses, although they will drastically reduce the damage). And even if you chase after your losses, you’ll probably question whether the chase was even worth it, because trying to squeeze money out of someone that allegedly doesn’t have any is brutal and fruitless.
- Plan your finances: the biggest fear is almost always the worry of having to pay the mortgage- most landlords rely on the rent to pay the mortgage.
You need to ensure that you can make the payments in case the late payments continue. Plan your next few months, and if needs be, make changes to your lifestyle to accommodate the situation. You could also try contacting your mortgage lender and see if they’re prepared to cut you some slack, but I wouldn’t hold my breath.
Needless to say, every landlord should have a contingency pot they can dip into so these situations can be absorbed, but yeah, let’s be real. Do whatever you can to gather some disposable cash to keep afloat.
Even if your tenant assures you that “they will resolve the problem shortly”- still make arrangements, which leads me onto my next point…
- The lies and excuses: It’s not uncommon for tenants in arrears to become absolute bullshit merchants, saying and doing anything for some breathing room. While it can be frustrating, it’s a survival tactic, and you can’t entirely blame them for trying to get by.
If they lay it on thick with a sob story, be compassionate, but more importantly, stay focused on the situation and don’t let your empathy cloud your judgment. Whether they’re being genuine or not, or whether you believe their story, doesn’t change the fact that they still owe you money.
I’ve lost count of how many times a tenant has told me they’re on their way to the bank to pay rent, only for the payment to never arrive. Despite it being 2024, and no one needing to visit a bank to transfer money, this excuse miraculously persists. It’s perplexing how a trip to the bank seems to become a journey through the Bermuda Triangle.
- Your tenant has the upper hand: the ball is truly and firmly in their court, and that’s the hardest part to accept because you’re at the mercy of someone who has broken the deal.
They have the power to make the process either extremely quick and easy or excruciatingly slow and painful. However, it’s important to note that you can influence how it unfolds by how you manage the situation.
- Two wrongs don’t make a right: it doesn’t matter how much wrong and pain your tenant has inflicted on you, you still need to stick to the proper legal procedures. That’s one hard muther-fudging pill to swallow, but you’re a professional, so you’re going to swallow that cucumber of a pill like a man.
- Eviction: if the tenant falls 2 months in arrears, the process of eviction can commence, but only then. That may seem like a life sentence, but that’s because it is.
I’ll be the first to say that having to wait for a rude numpty to fall 2 months into arrears before being able to legally kick-start the eviction process is scandalous. But it is what it is. Patience.
On a side note, you might be able to evict on other grounds (other than rent arrears) that may allow for a quicker eviction. Here’s a list of the different grounds for section available to landlords. Alternatively, if your tenant is approaching or is out of the fixed date period of the tenancy term, it might be easier and quicker to serve a no-fault Section 21 notice.
- Landlord Vs Tenant: the bitter truth is that it’s often extremely difficult to restore a healthy relationship once a tenant falls into arrears, even if the debt is eventually paid. While it largely depends on the reasons behind the arrears and how the situation was handled by both parties, there’s usually too much uncertainty and bad blood afterward. It’s like when someone commits adultery in a relationship; things are rarely the same afterward.
In most cases, the landlord will prefer to find new tenants because rebuilding trust is a challenging task, and the lingering resentment often remains like a fart on a hot summer’s day. You may need to accept that the relationship is over and focus on finding suitable replacements. While it’s not necessarily a bad thing, it’s something to be aware of.
4) Communication is imperative
At the early stages, communication is vital.
Once it’s been established that rent will be late, or is late, refrain from allowing your understandably sour mood to surface and take control when communicating with your tenant. Bite your tongue if you must, and dump your frustrations elsewhere. I have this blog, this is my therapy, feel free to also unload in the comments section. Permission granted.
As said, it’s better to try and work with your tenants than against, so try to keep them on your side, or at least on neutral territory.
Be understanding, and recognise that this can be resolved amicably and quickly if it’s handled rationally. The source of the problem might just be an abnormal, unforeseen circumstance, which won’t take a miracle to resolve. Don’t act prematurely before truly understanding the situation. Try to resolve the situation.
Enquire why the rent is late, when it will be paid, and if there is anything you can do to help. It’s important to focus on your primary goal, which is to collect rent, so you need to be accommodating and helpful, despite how aggravated you are. Yes, it’s two-faced, but so what, really?
Finally, remember, it’s important to use traceable means of communication e.g. recorded delivery letters and emails with receipt confirmation. If this ends up going to court, you will need all the evidence you can get your grubby little mitts on, especially ones that will prove that you tried to resolve the problem professionally, legally and fairly.
“He said this”, “she said that”, “he tried to poke it in me” will get you nowhere.
If your tenant has completely stopped paying rent then the odds are communication is out the window; they’re probably unresponsive. Sadly, that is normal.
5) Try offering solutions
Realise that it is unlikely your tenant will maliciously pull the rent from out of their arse, so trying to ‘force’ it out of them will most likely be futile. If they could pay, they would. Your time is better spent thinking of how you can come to a solution together that will work for both parties.
If you can, offer a solution. Again, this will largely dependent on “why” the tenant is arrears in the first place. But creating a fair and realistic repayment plan can be effective. You may not retrieve the total amount owed any time soon, but knowing the debt is slowly being reduced is better than nothing.
6) Send ‘late rent’ notices
If my tenant is 3 days late on rent, I send a friendly enquiring text message and wait to hear why, and once I receive the response, I give them a call to discuss the situation if their reason concerns me.
While it’s always best to communicate via letters/emails, I find that it’s more practical and easier to discuss these situations over the phone. Plus, it means my gentle and kind “tone” isn’t misconstrued as violent and aggressive, and that’s important during these times.
If rent hasn’t been paid with in 5 days, irrespective of what was discussed on the phone (assuming they picked up), I send them a rent arrears reminder notification in the post.
During the initial communication (either by phone or messages), I kindly inform them that I plan on sending the notification just for my records and because it’s protocol so it doesn’t come as an alarming shock and feel like a kick in the face when they receive it.
If rent is still unpaid after 14 days, I send them a follow-up rent arrears reminder notification. Both notifications I send are downloadable from the links I have provided.
As already discussed, tenants behind on rent generally have one common trait; they promise the world just to get us off their back. So disregard everything they have promised, it means nothing, send the notifications regardless. Don’t delay based on promises, because you’ll end up wasting precious time.
7) ‘Late Rent’ penalty fees
I’ve written about tenant late rent penalty fees in detail before, and I’m definitely not a fan of using them, purely because I think they’re massively counter-intuitive.
If your tenancy agreement is riddled with late rent penalty fees clauses, you might be tempted to start reminding your tenant of the financial sanctions they’re liable for at this point. Of course, that’s your right, but I’d be cautious before adding fuel to an already lively and difficult situation.
- While it won’t be always the case, it’s mostly safe to assume that if a tenant is late paying rent, they’re going through financial difficulties. So if they’re struggling to pay rent, they sure as hell won’t be able to pay the late payment fees.
- Enforcing late payment fees will most likely terminally sour the relationship with your tenant. Moreover, a irritated tenant is much more difficult to handle. The primary aim should be to get the rent, and the best way to do that is to make it easy for the tenant, not more difficult.
8) Admit defeat when it’s time and get professional help
You’ve remained calm, you’ve tried to resolve the problem rationally, but your tenant isn’t playing ball.
Three weeks has passed, and you don’t see any light at the end of the tunnel. Your tenant has only delivered broken promises and/or assurances that you have no confidence in.
It’s time to admit defeat and start psyching yourself up to start planning for eviction/repossession. In reality, this is where it often ends up. I’m sorry, but it’s true. Brace yourself, but continue to remain calm.
A big mistake many landlords make is delaying this step, often because they’re promised by the tenant that the situation will be resolved. However, in my experience, these promises are usually broken. It’s easy to be hopeful and get drawn in, especially when offered a resolution. While it’s important to consider the possibility of a genuine solution, don’t keep waiting once a promise is broken.
All I can recommend is, stick to the path of being professional by detaching yourself from everything but the underlying facts: your tenant is significantly late on paying rent, they haven’t stuck to the deal or kept to their promise, and you’re continuing to lose money. So now you need to take action, and not sit back and rely on hope.
‘Hope‘ will get you killed… or leave you disappointed.
In most cases, you will need to serve the relevant notice, whether it be a Section 8 or Section 21, that’s usually enough to scare them into paying what is owed and/or vacating the property.
If the tenant eventually pays and you want them to remain in the property, then that notice can be forgotten, so it’s best to always serve notice in these situations.
Once a notice is served, and you’re sure it has been received, don’t communicate with the tenant unless it’s necessary. It’s a waiting game now. It’s tough and extremely frustrating, but you’ve done your part for now. The next step is eviction…
I’m not going to discuss the eviction/repossession process here, because I’ve already covered how to evict a tenant.
I will say this though, if at any point you feel out of your depth, don’t be afraid to seek professional help.
Do you have Landlord legal advice and expenses insurance?
Before taking action, I recommend checking if your landlord insurance policy includes “legal expenses cover” Many landlord policies do, which could mean you’re covered for legal advice and services, including issuing notices and managing evictions.
If you’re unsure, contact your insurer to confirm.
If you are covered, reach out to them immediately. They’ll be able to explain what you’re covered for and how they’re able to assist, which often includes the use of their own legal team to handle the situation for you.
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9) Sometimes a loss is a victory (vacating & rent recovery)
You may need to cut your losses and consider it a victory. Your pride/ego may take a battering, but that’s something you’ll eventually overcome with excessive alcohol and drugs.
If your tenant says “Hey, look brother, I can’t pay the rent, I don’t have the money, but I’m going to move out ASAP”, that’s usually a victory in these situations in my eyes. Allow the tenant to surrender the tenancy.
Trust me, the sense of relief you’ll feel when a tenant in arrears vacates, despite the fact they owe you money, is mind-blowing. It can be a euphoric high if you allow it to be.
Either way, the last thing you want to do is try and keep a tenant like that shackled down so they’re forced to honour the fixed dates in the tenancy agreement- you’ll be cutting your nose off to spite your face. You’ll effectively be trying to cage a beast. It’s healthier and easier to start over with hopefully better tenants that can keep the cash flowing. A fresh start.
Be realistic about what you can and can’t achieve, and salvage whatever victory you can.
By all means, once they have vacated, feel free to chase and recover any owed rent (link to guide/services that can assist with debt collection), because you’re absolutely entitled to that. But again, you need to be realistic about the achievable gains. Needless to say, you should be getting some comfort by the tenant’s security deposit.
10) Once it’s over
This may seem a far cry away, but despite how low, horny and hopeless you feel right now, it WILL be over, and you owe it to yourself to learn from the situation when that glorious day approaches.
Try to understand “why” your tenant fell into arrears, and learn from it. Was there anything you could have done differently to prevent the situation from occurring in the first place? Was it a case of not having a stringent enough screening process when you were sifting through the tenant applicants? Takeaway whatever you can from the experience and use it to your advantage.
Prevention
Unfortunately, there’s no silver-bullet solution that will make any landlord immune to this kind of attack, because we’re dealing with humans in a world where “shit happens”- even to the best of us. However, the following will make life easier…
- Limit the risks: the best and only place to start is from the tenant referencing stage. Choose wisely, and be annoyingly diligent. Finding good tenants is one of the most crucial parts of being a landlord.
- Be prepared: understand you’re not immune to rent arrears, so always be prepared for when it happens. Rent insurance policies, tenant guarantors and short tenancies are useful and good ways of limiting damage. But also, keeping an emergency pot of cash aside to help absorb these unforeseen circumstances is good business.
If there’s one single piece of advice you should takeaway from my meandering dribble, it’s that you should ALWAYS follow the legal/proper procedures, even if that means fighting every last urge in that bangable body of yours. I mean that respectfully.
Finally, good luck. I am with you.
Disclaimer: I'm just a landlord blogger; I'm 100% not qualified to give legal or financial advice. I'm a doofus. Any information I share is my unqualified opinion, and should never be construed as professional legal or financial advice. You should definitely get advice from a qualified professional for any legal or financial matters. For more information, please read my full disclaimer.
I meant to add - when you make the payment date change request, provide direct evidence of the your changed payday and the funeral expenses.