Property owners rely on rental income to pay mortgages, maintain properties, and help meet other expenses. When rents are not received, these expenses must still be paid, creating an unnecessary hardship for the property owner.
What happens to self-managed landlords when rent payments are not made?
Tenants always have a reason why the rent is late. Rather than engaging in conversation and losing valuable time, begin the process by issuing a Five-Day Legal Notice to the tenant, delivering by hand or certified or registered mail. After the notice is issued, evaluate whether this is a long-term or short-term problem. If it is short-term, negotiate a payment arrangement. Any payment plan must be in writing and signed by the tenant.
If the tenant’s inability to pay is due to a long-term situation like a job loss, try to get the tenant to move out voluntarily. If the tenant will not voluntarily move, proceed with the legal eviction process, which was started with the Five-Day Notice.
Next, file a complaint with the court to repossess the property.
Hiring an attorney to help with the eviction is less costly than the amount you may lose trying to do it on your own. Remember, the cost of the attorney, court costs and process-server fees should all be paid by the tenant (if you can collect). When done correctly, the process will yield a judgment for all unpaid rent plus costs incurred in filing the case.
The court will also order immediate possession of your property, providing the opportunity to file a Writ of Restitution within five days.
It can take about 30 days to get the tenants out of the property.
Conduct a thorough inspection after the eviction and get bids to complete repairs to get the property ready to rent. You must also do the security deposit disposition.
A non-paying tenant is a headache and probably the most stressful aspect of property management. Evicting a tenant, coordinating, and paying for repairs, and re-marketing the property will reduce your profits. And the longer it takes, the greater your loss.
Accessing professional help — and understanding the Landlord & Tenant Act — will help by quickly and efficiently moving through the process. Property managers are well trained and understand the eviction process and can be a great resource for you. The cost of professional property management services is negligible compared to the losses landlords can suffer when self-managing investment property.
Maricopa residents Sherman and Euphemia Weekes have more than 30 years’ experience in property management and own Crest Premier Properties. Licensed Realtors and active members of the National Association of Residential Property Management with a Certified Residential Property Management designation.
This sponsored content was first published in the August edition of InMaricopa magazine.