As COVID-19 continues to paralyze the social and economic prospects across the country, people are losing jobs and income, so here are the best practices for handling Rent Collection During COVID-19.
A record number of people continue to file for unemployment, with each week’s numbers higher than the last. A loss in income means tough decisions have to be made. It’s not unfathomable that some of these people will soon be faced with the choice between paying for food or rent.
As a landlord, what does that mean for you? Late or potentially missed rent will most certainly impact your business. Depending on your cash flow, it could be a minor inconvenience or have dire consequences on your ability to pay your mortgage.
Communicate
With a clear, strong lease, your tenants already know the expectation is to pay rent on time or face a penalty. But in these unprecedented times, and with new provisions protecting renters
from eviction and delaying rent payment, how should you communicate with your tenants? Early and often. Be clear with your tenants about the expectations under the new guidelines and what they mean for them. Often, people hear buzzwords in the news about no foreclosures and no rent being due but are wholly unaware if it applies to them.
Be Creative
For residents who cannot pay rent due to virus-related loss of income, suggest a payment plan. This allows them to not get behind on rent that will ultimately become due and keeps cash flowing into your pocket to help you meet your expenses. Strongly consider waving all late fees, not indefinitely, but for the time being.
Some creative solutions to consider: perhaps your tenant is currently out of work, but could help with the mowing and landscaping of the property consider that a partial payment towards the rent. Maybe they can help do some repairs or painting that you were going to hire out. Not only will this help your workload and them paying off their rent, but they will likely feel grateful that they can keep busy in this crisis.
Send a Letter for Rent Collection During COVID-19
Consider sending an email and written letter, and posting it in the common areas of your income property, if that applies. As always, make sure it is translated into any relevant language(s) to your particular renters to ensure understanding and compliance. Be sympathetic and caring; these are people who are grappling with this uncertain time just like you.
Assume the best that your tenants want to pay their rent and will only skip it if they genuinely are unable to do so. It’s advised that you clarify some misinformation that is spreading surrounding the relief available during the pandemic.
Some facts you may wish to include in your correspondence include:
- Please know that no rents are being waived, and your rent obligations per your rentalagreement are due in full and as scheduled.
- To qualify for non-payment due to COVID-19, you must be able to show an inability topay rent related to the pandemic due to circumstances including lost work, childcare issues, and healthcare costs incurred due to the coronavirus.
- Non-payment is not forgiven; you will have to pay back rent after the emergency periodexpires. In some areas, it will be repaid at a premium of 125% to make up for missed rental payment; be sure to check your local ordinances.
- If you have been impacted by the coronavirus, please provide written notice of yourinability to pay rent as soon as possible. We will evaluate requests for relief on a case- by-case basis, with the requirement that evidence be submitted to demonstrate the
- Hardship and inability to pay. Please understand that relief can only be granted by a written letter signed by the management company and not verbally by an on-site manager or employee.
- Please continue to comply with all health and social distancing guidelines as they areissued and do all that you can to keep yourselves and your loved ones safe.
