Find out what to do if things go wrong and your tenant fails to pay. 

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Perhaps the greatest fear of any property owner, is what to do in the event a tenant stops paying. Industry professionals use this as a way to generate fear in landlords who will hopefully hand over the keys to them to take over. 

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Have no fear, there are processes and procedures for how to deal with this situation and this chapter will direct you to the right place for guidance.

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The framework for responding

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Consider the acronym ORNA.

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Overdue

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If your tenant is a few days late on rent it is a good idea to send them a reminder as they might have just forgotten payment. 

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However after a set period the unpaid rent is considered to be in “arrears” and legal options should be considered.

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Resolution

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The  first step should always be to try resolve the problem directly with the tenant, with the intention of coming to an agreement for which the rent is repaid in the short term.

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Notification

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If the landlord and tenant are unable to come to an agreement (or after the rent becomes legally arrears), it is essential to issue the tenant with a legal notification outlining the details of the unpaid rent.

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Apply

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If rent remains unpaid following the notification, the landlord should consider their legal options. 

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This may involve issuing a Notice to Evict and/or file an application to the local courts or Tribunal.

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What if a tenant is late to pay their rent?

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When dealing with unpaid rent each state has different legislation to protect landlords. We have compiled a high level overview for each state on the following pages. 

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For more detail and conditions see our blog here.

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It is important to remember that at all stages of this process the landlord cannot use physical force to remove the tenant. Law Enforcement can assist in the eviction following an approval in the “Apply” stage.

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Use Resources & Keep Records.

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Almost all the state governments have published compliant documents for you to use, and provide a support service over the phone for you to ask questions. 

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To improve the efficiency of the legal proceedings it is important to follow your state’s rules and keep thorough documentation detailing all unpaid rent, communications and legal fillings between yourself and the tenant.

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How RentBetter can help

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A number of the tasks described on the previous pages are fairly mundane, repetitive and straight forward. While these are often completed by landlords today, the team at RentBetter have worked very hard to automate these tasks and provide you with a better way to find and manage tenants.

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Never miss a Rental payment.

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RentBetter gives you more control over rental payments to ensure you get paid on time, every time.

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With RentBetter, once you onboard your tenant, a payment schedule is created for both owner and tenant where you can see payment dates and a ledger based on the history of payments. 

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If a payment is missed or fails for some reason, notifications and alerts are sent to owners and tenants to take action quickly.

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Find out more about how you can collect and track your rental payments through the RentBetter platform here.

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Key Takeaways

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Use the acronym ORNA. 

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Formal notice of unpaid rent should always be given to tenants.

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Don’t stress... laws exists to protect landlords in the event of unpaid rent.

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Each state’s rules are different. Landlords should be familiar with the required action for their state.

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Use RentBetter for an automated, real-time management system for rental payments.

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Download the Self-Management eBook.

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Want to understand how to rent out and self-manage your property? Start here - Your step-by-step guide to renting out your own property will include:

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• How to rent out your property - Six simple steps from advertising your property through to signing a lease and managing rental payments.

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• How to start your lease - State-by-state guide for setting up you lease, collecting bond, conducting a condition report & more.

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• Inspection checklist - Everything you need to do to organise and manage inspections.

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• What to do if a tenant doesn’t pay? - What to do next and which state-based laws apply.

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• How to advertise your property - What to include in your property ad to make it stand out.

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• How to select a tenant - What questions to ask and background checks to make.

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• How to collect rent - Payment schedules, rental ledgers, receipts & more.

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