Friday, July 25, 2008

Late Payments and Bounced Checks

Late payments and bounced rent checks are generally governed by the lease document. A lease document which deals with late and returned payments is essential. Assuming your lease allows you to collect a fee for a returned payment and/or a late payment, you should write the resident and advise them of what happened and request a replacement payment, as well as any administrative fees you have the right to collect. Also, if your lease allows for it or she is in a month-to-month tenancy, you may want to consider giving her notice that in the future you will no longer accept checks from her, only money-orders IF this happens again. Be sure to not be personal in this letter, so that it is very clear you are not playing favorites. It is best to have a written policy stated in the lease or somewhere in your business records indicating how many returned payments you will tolerate within a 12-month period BEFORE you give notice to a resident you will only accept a bank or cashiers check. And remember to save a copy of the letter in her tenant file for future reference.
As Always,
Ms. Merrie