How often... - Posted by Brian (OH)

Posted by JeredWA on July 30, 2007 at 22:16:59:

…the day it is late. Oh, and I include the late fees.

Got the results I wanted: half of the tenants started paying on time like clockwork and the other half all moved out (small 10unit turnaround park). New tenants are on the new plan.

I’m about 2 months away from not chasing the rent anymore. I don’t have time for this nonsense.


How often… - Posted by Brian (OH)

Posted by Brian (OH) on July 29, 2007 at 15:56:37:

do you have to go visit your buyers?

I have a buyer who sends in their payments and is always late. I set up a personal mail box to receive payments which worked fine for my other buyers. They don’t like mailing their payments because they don’t have a checking account. I set up a separate account at my bank so they could just deposit their payment in cash.

They still are not making their payments on time. I feel like the only way for me to get paid is to show up at their door 2-3 times a month.

Am I being “trained” or am I expecting too much?

Re: How often…you are now in the fee business - Posted by FeeMan

Posted by FeeMan on August 06, 2007 at 17:14:37:

Lonnie makes a point of comparing the process to banking in a sense, and as you know from your own bank statements, they are in the fee business, not lending, or checking, except as a necessary element of the FEE business.

Another poster stated he collects EVERY fee dollar, and you should as well, however, they need to be informed in their agreement, and see the process enforced with door postings when late, and pickup fees, as Steve suggests. You will get another 5% or more from these people, per annum, it seems from your posts.

Re: How often… - Posted by joe-ga

Posted by joe-ga on August 01, 2007 at 22:06:15:

send them a certified letter that states the term of payments… the rent is due on __________
if it is over 3 days late please include a $50 late fee…if it is not paid in 7 days, including late fee, an eviction notice wil be served. and include, your methods of where they can pay…might also include, I look forward to serving you in your housing needs in the future…

Re: How often… - Posted by mark

Posted by mark on July 31, 2007 at 17:22:27:

I post Late notices and or Default notices on their door just like the park does with pay or vacate notices. That always gets thier attention and they will call me and tell me when they’re are going to pay me. I also have a stainless steel lock box on the outside of my house that they can drop thier money in. My wife and I call it the magic box, because everytime I open it, magical there is money in it.

Charge the late fees - Posted by Keith (OH)

Posted by Keith (OH) on July 30, 2007 at 20:41:23:

I have found that religiously and systematically collecting late fees is one of the most effective ways for me to keep my buyers paying on time OR get compensated for the inconvenience. Collect every penny every month from late payors. I charge $50.00 plus $2.00 per day and I rarely waive a cent. I don’t go to their house, I send out a notice every 5 days and they see it adding up. After 3 weeks I do threaten a pay or quit notice.

Every year I collect enough money in late fees to purchase another lonnie deal or 2. It really does add up if you enforce it.


Re: How often… - Posted by Sailor

Posted by Sailor on July 30, 2007 at 18:07:10:

I don’t go to collect rent, which is expected no later than 5 pm on the due date. I do go if the rent is a day late, just to serve notice. Somehow, they learn to avoid having me on their doorsteps, & some take pains to pay early. Tenants also receive notice on the 3rd tardy. I still deal w/tenant problems, but late rent is @ the bottom of the list.


Re: How often… - Posted by Jeff-oh

Posted by Jeff-oh on July 30, 2007 at 11:45:19:


Compose a nice letter (I’ll send you ours on the side) with a stamped self addressed envelope, reminding them when their payment is due and what is expected. The day their payment is over due send a second letter stating that their loan in over due and that if payment is not made then the loan may be declaired in default with consequences of such decleration.

It is amazing how much more weight a written letter carries than you giving a call etc.

I reward improved and good behavior with written praise in the following months letter… i.e. “you have started to build a good credit history with our company, continue and the need for these letters will diminish”


Never - Posted by Karl (Oh)

Posted by Karl (Oh) on July 29, 2007 at 17:33:07:


Why can’t they mail you a money order? Many of my buyers don’t have checking accounts either. They go to Speedway and buy money orders.

I don’t ever go to a buyer’s house to collect money. They have to get it to me. But I still get the occassional call from the clueless buyer who says “I got your money, come on by”.


you’re being trained - Posted by Steve-WA

Posted by Steve-WA on July 29, 2007 at 16:09:14:

two ways to do this:

if you dont mind the trip, and you DO get paid when you show up, then keep doing it.

If you want the house back, and want to do repairs and resell it to someone who will follow the rules, then next time you show up, show up with a pay or vacate notice.

neither is more correct. It just depends on how you want this to go.

but I would have a talk with them - explain that they agreed to do the deposits, and if you have to come pick it up, thats OK, but a fee needs to be charged - $35? That’s what I would do.

Re: Never - Posted by james(CA)

Posted by james(CA) on August 01, 2007 at 16:34:46:

What do you do if some tenants always pay 1 or 2 day late due to mailing or whatever, send late notice and threat further action like rule violation?

What is a good due date, 1st of a month or 30th or 31st of a month?

Re: Never - Posted by Brian (OH)

Posted by Brian (OH) on July 30, 2007 at 06:52:51:

When a buyer is late, how do you communicate with them. I assume you don’t go out in person. Do you call them? Or do you communicate only via certified mail?

I think I may have caused the problem. When they were late the first time, I went out to see what the problem was. Unfortunately, this has been the process ever since.

Re: Never - Posted by Wayne (ID)

Posted by Wayne (ID) on August 01, 2007 at 16:52:49:

My Promissory note states that payment must be RECEIVED by __th day of the month. I stress to them that RECEIVED means that it’s not my fault that it took 3 days for the payment to get across town. Kind of funny because I’m a mailman. I never have had a payment late because of slow mail service. I do check the cancellation marks.

“What is a good due date?” I let the buyer pick a due date. I always counsel them that the park must be paid on the 1st therefore if they receive 2 checks a month I suggest that their payment to me be due on the 20th or so. If they get paid on the 15th they have 5 days to get the payment to me and actually 10 days before late fees apply. I like getting checks all month long instead of all at once:)


Late letters - Posted by Karl (Oh)

Posted by Karl (Oh) on July 30, 2007 at 15:28:21:

I send a friendly letter (regular mail) a couple days after the due date saying “have you overlooked your payment?”. If they don’t respond within a week, I send a second more serious letter. If they don’t respond to that, I send them a letter stating that I’m starting legal action against them. The last letter they get is from my lawyer. But I also know some investors who don’t hee haw around and just go straight to the angry lawyer letter.

I sit down once a week for about an hour to print and send out late letters. I use Notesmith’s late letter mail merge feature, it makes it very quick and easy to print an addressed late letter for a windowed envelop.

I used to knock on doors a lot, and thought that was very effective. But it takes too much time now.