Dodgy tenants will find creative excuses for not paying rent. Here are some warning signs that you might have a one on your hands, and what you can do about it.
When it comes to not paying rent, most rental agents have heard every excuse in the book. My bank burnt down (true story), I supply the government and they haven't paid me, my car broke down and I need to pay for repairs, I don't agree with the lights and water account, I’m sure I've already paid, and our personal favourite, I'm on holiday in Mauritius but will pay as soon as I return, have all been trotted out by tardy payers at some stage or another.
There are of course some solid reasons why a tenant doesn't pay rent on time. However, as Anthony van der Riet, business performance coach at The Coaching Factory says, those who understand the importance of paying on time will often make a point of calling the agent (or landlord) before month-end to explain their situation, as well as making the necessary arrangements to rectify their account. The chancers on the other hand will avoid all efforts to get hold of them and will come up with a new excuse every time the rent becomes due.
Generally speaking - and unless the lease agreement states otherwise - rent is due on the 1st of every month.
“The problem is that landlords want to be paid on time and don’t want to hear excuses, particularly if they are paying an agent for a service that needs to be fulfilled.” He notes that something which continues to cause problems is the mistaken belief to which many tenants stubbornly cling: that they have until the 7th of the month to pay up. Generally speaking - and unless the lease agreement states otherwise - rent is due on the 1st of every month.”
Some tenants are always going to be problematic and are best avoided. So how do you do this?
Van der Riet says there are clear warning signs that a landlord may be in for a choppy ride and these include:
• Complaints from the neighbours about noise or overcrowding.
• The tenant suddenly starts paying the rent after the 1st of the month.
• Half of the rent is paid at the end of the month, and the balance a week later.
• The tenant withholds the rent because of the water and lights account.
• A list of new defects or repairs is used to delay paying the rent.
• The tenant doesn’t answer calls or emails.
• The tenant makes excuses not to allow the agent to do a quarterly inspection.
He advises any estate agent or landlord to conduct these necessary checks to ensure that a ‘good’ tenant is placed in the home.
• Screen potential tenants thoroughly.
• Ask applicants for bank statements to determine how they conduct their finances.
• Ask for a reference and payment profile from their previous landlord.
• Take out rental insurance.
• Let the tenants know how much you appreciate the rent being paid on time.
• Carry out repairs promptly when asked to do so by the tenants.
Some tenants are going to take chances regardless of what the landlord or estate agent does. However, it is important to show a tenant that you mean business and remain firm. While compassion and understanding are important in any relationship, this doesn't mean that a landlord (or letting agent) should simply roll over and play dead, accepting every excuse and allowing the tenant to call the shots as to when he will pay the rent. Having a roof over your head is pretty important and as such every tenant should pay the rent first and worry about other bills later.
Creating a solid business relationship is vital and those who approach the letting process in a professional manner will generally have more success. Van der Riet says there are steps that should be followed and these include:
• Send the invoices for rent before the 25th of the month
• Send a WhatsApp, SMS or an email notifying the tenant that the invoice has been sent
• Clearly state on the invoice that the rent must reflect in the agent’s or landlord’s account on or before the 1st of the month.
It doesn't end there. A landlord or agent, acting on the behalf of the landlord, must:
• Keep the rental deposit in an interest-bearing trust account.
• Provide receipts for payments received.
• Provide a quarterly statement on the interest earned on the deposit.
• Ensure that the premises are safe, habitable and accessible for the tenant.