UNPAID RENT? 6 PRACTICAL TIPS TO GET PAID

  • Le problème du loyer impayé

For a tenant, the payment of the rent is his first obligation. The lease should stipulate the day and terms of payment. A reasonable time limit may be allocated to the tenant who pays his rent late. But what can one do if a tenant is consistently late in his payments or simply doesn’t pay? What are the good legal practices in order to recover unpaid rent ?

Here are 6 tips for landlords who have unpaid rent.

1) Make your life easier: fill in the lease properly

The lease is a contract between the lessor (landlord/owner) and the tenant. It is important to complete it and clearly state the terms of payment. If this is not done, the Law mentions and requires that the lessor collect the rent in person at the tenant’s dwelling on the 1st of the month. This can be inconvenient. Resolve the problem at the source by stipulating the date in the lease.

* Please note that the lessor cannot require post-dated cheques.

Even if stipulated in the lease, this clause could be invalid.

2) Maintain good communication with your tenants

A tenant who is late with his rent money does not necessarily mean that he is acting in bad faith. An oversight may occur, just as it may also be due to a temporary financial impasse. If this is the case, good communication can help you avoid many problems. A payment agreement, other than the one specified in the lease, can temporarily be agreed upon to satisfy everyone.

You don’t need to be friends with you tenants, but if the terms of the relationship are clearly explained compliance will be easier. If you are strict on your deadlines your tenant will know he also needs to be this way. If you aren’t consistent your tenant may think he doesn’t have to be either.

3) Get institutional help

A reasonable time limit may be acceptable and it is up to the landlord to establish his tolerance threshold. Legally speaking, rent paid even one day after the date indicated in the lease is considered late. In many jurisdictions, you can ask for government institutional to help you with the recovery process. In any case you should always find out what free help is available. There is much you can do yourself or, in any case, without a lawyer.

4) Send demand letters for unpaid rent

If you decide to appeal, it is highly recommended to previously send a demand letter to the tenant. Otherwise, application fees may be charged to you if the tenant has, in the meantime, made the payment within a reasonable time-frame. In all cases of late payments, non-payment or any other issue that can lead to litigation, it is highly recommended to send a demand letter. It will demonstrate to the tenant that your intentions are very serious and will prove that you have given the tenant enough time to rectify the situation. Send the demand letter by registered mail or deliver it in person while making sure to have them sign a letter of acknowledgment.

To save money, draft your online demand letter at one-tenth of the price, directly on BidSettle.com.

5) Build your case

 It is important to keep all the evidence and documentation that is related to the unpaid rent and all of the resulting problems.

If a tenant is consistently late in his payments, in addition to demanding the late payment with interest, you can also ask the Régie for the lease termination and eviction of the tenant. He will then be responsible for the loss of rent even though he is not living there, until you find a new tenant. However, in this case, you must prove that these delays are causing you damages, such as a delay in your own mortgage payments.

6) Don’t be afraid to go all the way

A single tenant who doesn’t pay can be a pretty annoying thorn in one’s side, even for a hardened landlord. You should know that even if the delay is not repetitive, if it’s for more than three weeks, you can ask the Régie to terminate the lease, and this without having to prove any damage. On the other hand, if the tenant pays the rent and interests before the Régie’s decision, the termination will not be possible.

Showing your tenant you are ready to go all the way may, in it self resolve the issue. Keep in mind that the vast majority of legal problems are solved because people want to avoid further procedures.

Takeaways:

  • Use online legal help to reduce costs and to make the process of recovering unpaid rent faster. You can draft a demand payment letter online and negotiate a terms with a tenant that is strapped of cash. Using a third party often brings more credibility to the threat of legal action you will make. Furthermore, online tools help you keep records of all exchanges and recovery efforts.
  • If you keep records of your legal costs, you will eventually know how much you should invest in your legal cost to recover a single unpaid rent. Remember, legal recourse is also, and often mainly a financial decision. Knowing when to start or when to stop is key.
  • If the rent still hasn’t been paid after three weeks, in addition to requesting the amount due, in some jurisdictions the landlord can cancel the lease and evict the tenant. (This adds a lot of weight if mentioned in a demand letter.) If the payment is not made in due time, the tenant may be forced to leave the premises within the deadline set out by the law.