The challenges of collecting rent on your own

One of the most important tasks of renting and managing a property is making sure your renter pays their rent each month on time and in full.

Rental revenue is the heartbeat of your property investment and should be enough to cover any mortgage payments and regular maintenance charges, leaving you with a profit on top.

Many landlords find themselves in a difficult financial situation after going without rent for even a short period of time. This can be because they depend on the rental profit for their personal income or because they have to use their own money to cover the Buy to Let mortgage payments.

That is why it is so necessary for an agent or landlord:

• Before accepting a renter, extensive referencing and credit checks are conducted to ensure that they can afford the monthly rent payments.
• Checks are received on the day when rent is due.
• If rental payment has not been made, contact the tenant to find out why, and then take the proper next steps:
  • If it was a bank problem or the tenant simply forgot to pay, it should be simple to resolve.
  • If they’re in short-term financial problems, you might be able to agree on a payment plan.
  • If it appears that they can no longer afford the monthly rent or are intentionally failing to make rental payments, you may need to proceed with eviction.

Problems for DIY landlords that collect rent themselves

• It’s easy to forget to check on the rent due date, especially if you’re busy or on vacation.
• If a renter is having difficulty paying their rent, you should be understanding and handle the situation carefully, but don’t let it go on too long.
• Although ‘bad renters’ are uncommon, you must handle repeated non payment in an appropriate way to stay on the right side of the law and be able to evict them if needed.
• No matter how much the tenant owes or whether they ignore your attempts to reach them, you must understand that you cannot harass them and know where the legal limit is.

It’s also important to understand that if you violate the tenant’s rights or mishandle any aspect of the rent collection and debt recovery process, you may be unable to proceed with an eviction, and the tenant may even file a time-consuming legal claim against you!

This is why it’s worth considering hiring a property management company, such as Western Lettings Glasgow, to handle rent collection on your behalf making it.

Advantages of Hiring Professional Rent Collection Services

• Letting and managing agents are on the job every day, and they have procedures and processes in place to ensure their landlords are paid on time and in full.
• Tenants who are late with their payments will be notified and followed up on.
• Expert property managers are excellent at communicating and negotiating with tenants, ensuring timely rental payments and they should be able to detect any red flags when giving an explanation for why payment has not been made.
• If the tenant needs to be evicted, your property manager should work with you to ensure that the process is carried out correctly, preferably through a specialised evictions company.
• The agent will assist in bringing the tenancy to an end as soon as legally possible so that a new paying tenant can be moved in.

It’s important to note that the vast majority of tenants pay their full rent on time every month. However, mistakes do occur, and if late, incomplete, or missing payments are not addressed immediately, you risk losing a considerable amount of time and money.

Ways to make sure your tenant pays the rent on time

• When the tenant has completed their tenancy paperwork, give your bank information and ask that they set up a standing order for the rent.
• Keep a note to check with your bank on the day rent is due.
• Make a phone call to the tenant and follow up with an email to confirm your conversation in writing if the rent is not received.
• If it’s just a short-term affordability issue, it’s a good idea to offer the tenant a few months to pay off their balance. However, it is essential to ask the appropriate questions so that you understand exactly what the problem is and when it will be resolved. Make sure the payment plan is in writing, signed by the tenant, and that the agreed-upon amount is paid on the specified dates.
• If the renter continues to fall behind, it may be wise to initiate the eviction process:
  • You could serve a section 8 notice explaining the specific reason for rent arrears, but you must wait until the tenant is at least two months behind. If they refuse to leave by the notification date, you will need to go to court to obtain a possession order.
  • Alternatively, you might issue a section 21 notice at any time and give the tenant two months’ notice. If they do not vacate the rental home, you can apply for an accelerated possession order, which does not require a court hearing and may be a faster option than utilising a section 8.
• If the renter has been evicted, you can pursue them for any overdue rent. However, it is sometimes not practical to invest time and money in this; instead, focus on finding a new, paying tenant as quickly as possible to ensure consistent rental income.

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