My Very First Tenant Payment Issue!

[Ben Sears]

I've encountered my first payment issue with a tenant. For what it's worth, I'm not here to ask for advice but to simply share my experience in hopes that it helps someone else.

I purchased a SFH in September of last year with a tenant already in place. She lives with her two teenage children and has been an absolute rock star. Payments arrive on time, the house is spotless each time I visit, and I rarely hear from her. I've made some upgrades to the property after raising her rent slightly (despite the fact that it's still far under market value). So I get a phone call today from my tenant who wants me to stop by for a short meeting. She's very slim on details during the phone conversation, but I agree to meet her this afternoon. When I arrive, she wastes no time in telling me that she and her son have had a fight and he has decided to move out. Come to find out, it would appear that they are splitting the bills with him paying the majority of the rent. This has obviously left her high and dry this month for rent (which is due today).

Now my "regular" job is a firefighter/paramedic in a very "not so great" part of the city, so I'm intimately familiar with not bs'ing around with people in order to get them to do what you need them to do. I very politely, yet firmly restated the lease agreement. I told her that we allow a five day grace period and that the full rent would be due by next Friday (I gave her this weekend since everything will be closed for an impending snow storm). I made some helpful suggestions on how to pay her rent and told her to keep me in the loop next week. I very respectfully thanked her for being honest and upfront with her phone call and that it goes a long way in our conversation. I am hopeful that she makes rent as I would love to keep her. However, I won't have an issue replacing her and raising the rent again.

I need to credit Brandon Turner's "The Book on Managing Rental Properties". I'm 3/4 of the way through this book and it really assisted in pointing me in the right direction. It made me think of the consequences of forgiving rent payments and late fees, as well as how to respectfully deal with your tenants. I highly encourage any new landlords to invest in this book as it will truly pay for itself 100x.

I'll continue to update next week as our saga unfolds. Have a great weekend!