Vantage Property Management
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What to do when the rent is late.
Have a “plan” in place for this.
Hi, My name is Jim and our company is Vantage Property Management.
Today we want to take a bit of time to discuss an area of landlord property management which seems to be of great of concern to owners who are overseeing the management of a rental property on their own. And that is, "The tenant has not paid the rent on time, so what do I need to do?".
Before addressing the "late rent" issue directly, please remember to took at my short video "The importance of tenant pre-lease screening", as a good tenant screening process will head off most non-payment of rent issues later on in the course of the lease term.
And speaking of "processes", the smart landlord will have a pre-planned procedure set up in advance, should the collection of non-paid rent become an issue. Once you have this pre-planned procedure in place for collection of late rent, if this process is to actually work, you must then be prepared to follow the plan with NO deviations.
A well planned collection procedure will need to meet three criteria; 1. Will it be effective in getting the tenant to pay the late rent. 2. Will the procedure provide the tenant with a reasonable timeline for getting the rent paid. 3. Will your process stand up "legally", should it become necessary to settle the problem through the local Court system.
Here, at Vantage Property Management the late rent collection process works as follows. All rents are due from our resident tenants on the first day of each month. However, we understand that sometimes "things come up" which may cause a rent not to be paid on the first. Therefore, we allow a five day grace period before the rent is considered "late".
In the event that rent has not been received during the first five days of the month, on day six a very well defined late rent collection process comes into play. A complaint is filed in the local District Court, which is the start of an eviction process.
At this point, you're probably saying to yourself, "Only five days late and you're already going to court? That seems to be a bit extreme." Consider the following situation.
We constantly receive questions from owners who are managing a rental property on their own. Their story usually goes something like this, "Well, the tenant got one month behind on the rent, but they said that they would catch up during the next month. We're now going into month four with no rent, so I' starting to be concerned that the tenant will not be able to catch up and I'm not quite sure what I should do".
The reason for immediately starting the Court collection process is that if it becomes necessary to go all the way through an actual eviction, this becomes six to eight week process. However, the tenant can stop this process at any time, by paying the rent which is due (Which is the desired outcome for both the landlord and the tenant). The process is very much the same for most Maryland District Courts, with only some minor deviations.
The information below sets out the typical process for the eviction of a tenant from a property, in the event that they do not pay the past due rent. This process does not guarantee that the rent will ever be collected, only that the tenant will be removed from the property, should they not pay the past due rent (The process for the Court filing of a "money judgment" is somewhat more complicated and is not included in this discussion.).
The "Complaint" paperwork may be filed with the local District Court on, or anytime after the sixth day of the month. This usually results in the Court scheduling a hearing date within the next two weeks.
The Court will "summons" the tenant to be in attendance before the Court on the day of the hearing. This information will be provided to the tenant by way of delivery of a copy of the Complaint to the rental property by the local Sheriff's Department. The Court will also mail this information back to the property owner. The tenant can halt this process at any time, by simply paying the rent which is due (Remember, collecting the rent should be the whole intent behind this process).
In the event the tenant has not paid the rent by the day of the Court hearing, it will then be necessary that the property owner be prepared to to attend the hearing to present their side of the case.
It is important to note that District Court (small claims) hearings are conducted in a somewhat less formal manner than a criminal trial. However, this is still a Court proceeding, which will be presided over by a real judge, who will demand that the hearing be carried out in an orderly manner by all parties. If you feel apprehensive, or somewhat timid about pleading your case before the Court, you should probably contact an attorney to represent you at this hearing.
Should you elect to plead your case without professional legal assistance, the first thing to keep in mind when coming before the Court is that the judge is not "on your side", or "on the tenant's side". The judge will be expecting that each side be prepared to present the necessary information which will enable the Court to make a decision based on the facts which each side presents.
If you haven't done so recently, read through the lease agreement and be prepared to explain the terms of the lease to the Court, as they regard to the payment of rents.
Will the tenant be presenting evidence as to why all, or a part of the rent, is not being paid? Will you have a rebuttal to this evidence which will make sense to the Court?
Assuming that you prevail at the Court hearing, the Court system then provides that the process come to a halt for a five day period before moving forward.
After the five days have elapsed and still no rent has been received, the landlord will need to complete another form for the Court. This form basically informs the Court that, in spite of the recent judgment favor of the landlord, the tenant has still not paid and the landlord is therefore requesting that the Court assist with the removal (eviction) of the tenant from the property.
Upon the Court's approval of this request, the Court will turn everything over to the local Sheriff's Department, who will then schedule the actual eviction.
There are two things that need mentioned at this point. 1. The tenant can still halt this proceed by paying the past due rent, right up to the time of the actual eviction (Remember, collecting the back rent is what we all want).
2. The Sheriff does not physically conduct the eviction. He/she is onsite to oversee the process and to act as a "keeper of the peace". The landlord will be required to provide the manpower necessary to remove all of the tenant's personal belongings from the premises in a very timely manner (The Sheriff may require that the landlord have from as few as eight able bodies adults on hand, up to as many as the Sheriff deems as necessary to complete this action as quickly as possible).
What's to be learned from all of this is that nobody comes out a winner in an eviction. The tenant gets put out of the home and the landlord incurs, not only the loss of rental income, but the loss of time and money required to implement this action.
So what's the good news? If the overall Landlord/Tenant process is handled property, an eviction should be a very rare event. Here at Vantage Property Management, we manage over three hundred rental properties and, I am happy to say, that we easily go several years at a time without actually having to evict anyone.
We do have to start this late rent collection procedure on a hand full of tenants each month. However, by the time the Court wheels start turning and the Sheriff notifies the tenant of this fact, the rent usually gets quickly paid and it's literally "case closed".
VPM gets the rent money to the property owner and the tenant gets to remain in the home. Just what everybody wanted.
Hopefully, this overview has been helpful to you, as provided from the point of view of a professional Property Manager. Should more in depth information on this subject be required, it is suggested that an attorney, or other legal professional be contacted.
Vantage Property Management
410.729.2770
1120 Benfield Blvd.
Millersville, MD 21108