Zero Tolerance Late Rent Policy in California
Almost all independent rental owners try to work with a tenant that it slow to pay or gets behind in the rent. Don’t get me wrong, I totally understand why. Its costly to flip a unit to rent ready condition, vacant units is expensive and the legal fees to complete an Unlawful Detainer action can cost more money.
As a California investment property owner myself I also realize that a relationship between an owner and tenant forms over time. As humans we relate when things go badly in their lives. It’s hard to stay strictly business, when you feel for the tenant and can relate to what’s happening in their lives.
Some owners wait until their tenant is 2 months behind in the rent before contacting legal counsel to start the eviction process. If this sounds familiar to you please help break the cycle.
It is actually much more costly to wait before sending the file to legal for an eviction. Why??? You’re already 2 months behind paying the mortgage, and then come the legal expenses just to start the case; the tenant has had two full months to research all the stalling tactics to prolong the case to buy them more time in the property. The legal counsel then has to defend these tenants’ frivolous stalling tactics and that can get very expensive.
A zero tolerance late rent rule seems to be the best approach for many California landlords. What is a zero tolerance late rent policy you might ask? If the rent is due on the first of the month per the rental agreement, then you can serve a 3 Day Notice to Pay Rent or Quit on the second of the month – as long as the first is not a Holiday. Watch the month of January closely as New Year’s Day is a holiday.
Also, if you offered a grace period in your rental agreement stating that a late rent fee is not charged until after the 5th of the month, please take note that doesn’t apply to when the rent is due, it only applies to when a late fee in incurred. Make that clear in your zero tolerance late rent policy to your tenants.
By taking control and not playing into the, “I lost my job, my dog died, I lost my wallet, I had fraud on my bank account” etc. – because we all know that list can go on for days – it keeps you as the person with authority and the one in control, instead of the tenant trying to tell you how things are going to be.
Starting the Unlawful Detainer the day after the notice expires, cuts the time of loss of rents down considerably. Know this as a fact: You as the Plaintiff can have the case dismissed at any time in California. So, if the tenant has all the rent and the legal fees and the late fees you can have the eviction/ Unlawful Detainer case dismissed.
I would make sure that you have all fees and expenses in certified funds, in full prior to having the court case dismissed. If you are negotiating them to pay and stay and it’s the end of month I would also ask for the next month’s rent as well.
The most supportive thing that I can share with you is that your investment property is a business, and if you keep your emotions out of it and focus in a business-like manner you will find it much more lucrative. When the tenant mistakes your kindness for weakness it can be difficult to get the authority position back, without the assistance of the courts.
Making clear up front to your tenants that you have a zero tolerance late rent policy establishes clear expectations that must be honored to be allowed to continue to stay on the property.
Patti Widget is the Regional Director of Training for the Fast Evict Law Group and writes and conducts seminars on a wide range of landlord and tenant law topics.
At Fast Eviction Service, help on any of the issues discussed in this article is simply a click or phone call away. Email email@example.com or call our office at (800) 686-8686 to discuss your questions for a free evaluation of your case.
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