Rent is most commonly paid by standing order. Another option is direct debit. If using the latter, then there is a service called GoCardless (www.gocardless.com) that can be used to manage direct debits. It has three main advantages although there is a charge of £2 per transaction:
The tenant can be sent a link and they can complete the process of setting up the direct debit online.
The landlord will be notified when it’s been set up successfully.
The landlord will be alerted if a payment is missed.
An alert will be sent is the arrangement is cancelled by the tenant.
It’s vital that this is dealt with straight away. This is to set the precedent that the date due is the date that the payment must be made.
The tenant should be contacted on the evening of the day that the rent is due to question where the payment is. The tome shouldn’t be confrontational as it could be an innocent mistake but making contact on the due date makes the point that the missed payment is being taken seriously. Be on the lookout for excuses as some tenants can appear to be reliable but can string a landlord along for weeks with excuses and apologies.
- Again, this should be dealt with straight away. This time it will be known that the agreement has been set up successfully so has the tenant cancelled the agreement or doesn’t have enough money in their account. Tenants can genuinely fall on hard times, but a good tenant should make the effort to offer part payment and commit to a date when the rest will be paid. The important thing is to open an honest dialogue to ensure any problems can discussed easily
- If the non-payment isn’t an honest mistake or a one-off shortfall where the resolution is straight forward the problem shouldn’t be allowed to drag on for any longer than necessary. Once someone is behind with a payment it will be increasingly difficult to get the payments up to date once a number of months have passed.
- Genuine horror stories of non-payment are quite rare and when dealing with people unpredictable things can happen and most cases stem from tenants who are struggling through no fault of their own and trying their best to pay. But on the other hand, it’s dangerous to give the benefit of the doubt, because rogue tenants often seem quite plausible.
- Whatever the reason it’s time consuming and stressful to correct problems and prevention is better than cure.
There are two main types of prevention:
- Choose the correct tenant in the first place. This can never be 100% certain, but comprehensive referencing plus a gut feeling will go a long way.
- Payment issues need to be dealt with straight away and the right message should be sent at the start. In this way problems are less likely to occur down the line.
