How to Deal with Rent Arrears the Professional Way
Rent arrears, unfortunately is an issue that as a landlord you may have to deal with at some point in time. The cost of living has exceeded the minimum wage and it has affected the entire country’s way of living.
The sad reality is that most of us are living on a week to week basis, which has now become what can be considered as the ‘normal’ way to function. No savings, no emergency fund, nada.
Even investors aren’t so lucky either. Most landlords letting their properties are heavily relying on the rent in order to pay the mortgage. They are not rich in cash, contrary to common perception.
Here are a few tips on dealing with a rental arrears situation:
- Establish an arrears policy and make sure that your tenants are fully aware of it and its implications.
- Establish a regular schedule in checking your arrears. Ideally, you should check this daily.
- Regardless of the tenant’s situation, you or your property manager should issue a Notice to Remedy Breach if the tenant reaches 8 days in arrears. If they fail to fulfill their obligations to the payment agreement, you can then serve the Notice to Leave or apply to QCAT without further delay.
When writing an email to your tenant, be as tactful as you can be. Avoid sounding accusing. Simply let them know or remind them that your records are showing arrears. Being polite in dealing with the situation will less likely cause the tenant to be defensive, helping you achieve a seamless settlement.
Almost all the time, the landlord/property manager and the tenant can come up with a resolution to the issue by agreeing on certain payment terms. In the event that the tenant fails to fulfill their obligations to the said terms, the landlord/property manager would then have the right to recover the rent.
When all else fails, a free dispute resolution service is offered by the RTA to help find a resolution.
