What to do When Your Tenant Doesn't Pay Rent

Landlords are unsure of what to do when their tenant is late on a rent payment. These are the steps you should take if you don’t receive rent on time.

Whether this is the first time you’ve experienced a late payment or you have a tenant with a long history of paying late, it can be a frustrating situation. The last thing a landlord wants to do is chase their tenant for rent owed.

Many landlords are unsure how to proceed when their tenant misses a payment. In this article, we’ll review the steps you can take when a tenant doesn’t pay rent on time.

Refer to Your Lease

Standard leases list the rent due date as the 1st of the month. In California, landlords are not required by law to have a payment grace period. However, most landlords typically accept rent until the 4th of the month without penalty. If the fourth day falls on a weekend or holiday, the rent is due on the next business day. After that, you can charge a late fee.

You can also remind the tenant that the rent is due on the first of the month and has not been received. Sometimes tenants might genuinely forget to pay the rent or might have mailed the rent check on the due date. A friendly reminder can help maintain a good relationship with your tenant, particularly if they have not had a previous late payment.

Serve a 3-Day Notice

If you have completed the aforementioned steps and still have not received the rent, it’s time to serve an initial notice. This notice, called a 3-Day Notice to Pay Rent or Quit, gives the tenant three days to pay the rent. This is the first legal step required before you can move forward with an eviction.

The notice must include:

Tenant’s name
Property address
Amount of rent due
How the tenant can submit payment to you
Dates and times payment could be made
Who the tenant must pay

Standard practice is to make a copy of the notice and post it at the property. Make sure it’s posted where the tenant can see it. You should also mail them a copy of the notice.

If the tenant pays the rent within the three days, you don’t need to do anything else. If the tenant still hasn’t paid, you have the right to proceed with an eviction.

Cash for Keys

As a last ditch effort, you can trade cash for keys with the tenant. The eviction process is a long and costly one that neither the tenant or landlord wants to be involved in. While you may think it’s better to file an eviction to get it on the tenant’s record, it will only end up costing you in the long run.

Once the tenant has exceeded the 3-day notice period, you can reach out one final time to negotiate. In exchange for the rent owed and keys to the property, you will not file an eviction. Make sure you give them a hard deadline and once it’s passed, file the eviction.

The Eviction Process

Once the 3-day deadline has passed, you can proceed with the eviction. The first step is to contact your attorney and have them file an unlawful detainer with the court. Gather all necessary documents, which include the following:

The lease or rental agreement and any written changes the tenant agreed to
The notice you gave your tenant
Written proof your tenant was given the notice
The tenant’s rental application
The tenant’s ledger
Any other important communications the attorney should be aware of

Once the Summons & Complaint is filed with the court and posted to the tenant, you will wait for your tenant’s response. If your tenant does not respond within five days, you can request a default judgment from the court.

Once granted, the judge will order the tenant to pay court costs and attorney fees. Five to 14 days later, you will receive a Writ of Possession, which instructs the sheriff to lock the tenant out of the property. The sheriff will visit the property and notify the tenant that they must be out in five days. If they are not, they will be forcibly removed.

If the tenant intends to fight the eviction, you will be assigned a court date. The judge will hear both sides and make a decision. If they side with the tenant, the tenant will be allowed to remain in your property. If you win, the tenant will be required to vacate the property.

A Writ of Possession will be issued if you win the case. The sheriff will post this notice to the tenant five to 15 days after judgment, and the sheriff lockout will occur approximately one week later. You are expected to meet the sheriff for the lockout and hire a locksmith, who will change the locks so the tenant cannot access the property.

The judge will likely order your tenant to pay back rent, damages, penalties, and costs (attorney and court fees) related to the case. However, if your tenant wins, you could be required to pay their trial-related costs.

Important Things to Remember

It’s important to act quickly and be firm with your tenants when their rent is late. While you can be courteous and send them reminders, be sure to follow up on your word. If you tell them there will be a late fee, enforce the late fee. If you tell them you will file an eviction if they don’t pay, file the eviction. Giving your tenants too much leeway can result in them not respecting your rules.

You should document everything in writing. If you and your tenant reach an agreement, have them sign a document detailing the agreement and provide them with a copy.

If your tenant listed a co-signer on the lease, that individual is a responsible party and should be named in any lawsuits and documents.

Lastly, check with your attorney regarding local and state laws that might affect your property and your rights. See our chart below for a quick guide on serving notices at your property!

FAQ

How much can I charge for the late fee?

Under California law, a late fee will only be enforced if the fee is a reasonable estimate of the amount that the late payment will cost the landlord. The language must be included in the lease. California does not have a law specifying how much you can charge for a late fee, but we typically recommend 5 to 7% of the rent.

What if the check bounces?

Reach out to the tenant to notify them. California allows landlords to charge $25 for the first bounced check and $35 for each additional bounced check.

Should I accept partial payments?

It’s up to you, but remember to treat all tenants the same. If you change your policy, send a notice to everyone stating you no longer accept partial payments. We do not recommend accepting less than half the rent.

Olivia

Content Marketing Manager at Good Life Property Management

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