If you practice Zero Tolerance (no grace period) on rents, is there any legitimate reason will you accept when a tenant does pay rent on the due date?

For example: your tenant was in a bad car accident and is in the hospital. Would you accept this and cut the tenant a break on paying his rent that month or would you begin the eviction process as stated in your lease?

NE,

With software like square for example, no. They can pay right from their phone with a credit card in the hospital. If not them, then one of their emergency contacts.

No one that bills me cared when I was in the hospital, why should I?

Also, I don't think zero tolerance means no grace period, some states require you to allow a grace period.

"I think zero tolerance means not accepting any excuses".

Good point NE,

Zero sob stories, those are well taken in drama class but few if any business wants to participate, need a half gallon milk for starving grandkids - clerk at store - that is $2.29...

Same at filling station for 5 gallons - so you want $15 bux??

Typically no, but like most things in this business, it really is case by case. Just think about your existing tenants for example.

I have one lady who has not been late ONCE in 6 years, paid electronically every time and keeps the place nice. ZERO ISSUES.

I don't have any now, but I've had hooligans before like we all have.

If my 6 year flawless tenant texted me with an emergency and said she'd be a few days late, I'd say Ok and waive the late fee this time. Why not? 6 years flawless is deserving of consideration.

If a resident hooligan texted me and said they'd be late, first of all, I'd be shocked. Why? Because they aren't going to ice you a heads up. They'll blow you off, wait for you to contact them and then start with the BS excuses/reasons. Reasons to them, BS to me.

Both tenants would still fall in my timeline for eviction though, the only difference is I'd waive the late fee on the first late on the lady that has been there 6 years. If she didn't pay by the 10th, I'd be filing eviction though and she would be made aware of that on the 5th.

If she was late again next month, zero tolerance time.

NE,

I don't care if that's an excuse or reason. The reason why I don't care, is because them calling me and telling me that they're going to pay by the fifth falls with in my timelines. I would simply respond back and say that is fine please include the late fee. If it was their first late, I would waive the late fee and tell them that if there's another one received late again then both late fees will kick in at that time.

There is no reason that everyone of us or any of us here should run out and file eviction on the second of the month if the rent isn't received. Why? Because you're going to be doing that on so many tenants so often. Sometimes the first is a Saturday and they may have put it in the mail Friday or Saturday and it's not gonna hit your PO Box until noon on Monday the 3rd. What are you going to do wait at the door of the courthouse at 8 o'clock on Monday morning to file eviction on them? You just gonna drive yourself nuts with stupid stuff like that.

Auto draft rent is key to ending this nonsense. When they are on auto draft where a third-party company pulls their money, it's very often there to be pulled. I have very little issues with non-payment and auto draft rents. I had more issues with checks by far than ever with auto draft.

So if a tenant is responsible enough to have a checking account that gets pulled automatically and typically runs flawlessly and texts me on the first when it's due and tells me that it's not going to be there by the fifth and they're going to have to mail in a check, you better believe I'm going to let that fit within my timeline.

Sorry to keep posting so much, but I think this is a good question and I keep thinking about it.

I think for a landlord to properly execute zero tolerance, they have to have an almost perfectly established timeline that they follow with every tenant every month.

WRITE IT DOWN IF YOY HAVE TO!

In a case-by-case situation as I referenced above, only deviate little parts of it in certain situations like a flawless six-year tenant may have the late fee waived.

NE,

Here in AL, the beginning of any eviction starts with posting a 7-day P/Q notice on the tenant's door. If you practice strict Zero Tolerance, that notice would posted on Day 2 of any month if rent was not paid on the 1st.

If I was required to post it and not able to waive it in my lease, I would still post on the second. Or third if the third was a Monday. If that was my case here in PA, I may waive the late fee with a good tenant for example. Check and see if there's anyway that you can waive that notice legally.

Case by case Jeff. If I was going to a mechanic for 10 years and he sent me a bill in the mail and it's due on the 31st and I don't send that out to him until the first and he calls me on the second jump down my throat for no reason at all and looks like a total ___-hole, i'm probably going to start looking for a new mechanic.

I do. I live in a world that is grey, not black and white ... wiggled lines, not straight.

I have tenants in a house that have lived there since I bought the place. They have bought and paid for this house but I own it. If they needed wiggle room (and they have in the past) I would work with them.

New tenants, probably not.

I look at the big picture. If I put someone out, I've got one or two months vacancy - there is a lot of wiggle room between someone being late and me losing two months rent.

I have a tenant who was in a bad car accident, was out of work for over a month, and had to have multiple surgeries. The good thing was, it happened as she was driving for work so she was eligible for worker's comp. I did let the rent slide for 6 weeks, and as soon as she got the check she paid me. It was a bit of a gamble, but since it was late November when it happened (a lousy time of year to rent), I figured it was worth it. She's now current and has been paying on time every month.

Zero tolerance only means you have a process that you follow, not that you will be kicking them out if they don't pay on the 1st. If someone says they will pay on the 5th, I say ok and still put the 3 day PoQ notice on the door. If they pay on the 5th, great. If not, I can still proceed with eviction.

I'm not sure what part of "ZERO" is unclear. Zero means none, nada, zip, zilch, no how no way no never.

We've talked about this in a half dozen posts at least, Roy old Buddy. If you want to allow your tenants wiggle room...by all means. It's our business.

But ZT means zero.

Recall how I do my ZT. Rent is due on Day X. Late fees begin on day X + 1. I file on Day X + 7. No exceptions. That's my policy. I enforce it strictly on everyone.

I encourage my tenants to set up systems so that the rent is ALWAYS paid on time. I used to listen to excuses and have to play the judge. Is Johnny's excuse worthy and Jill's excuse unworthy? How do I need to document this to avoid looking like I am being discriminatory? Why am I constantly stressed out playing "god" of worthy excuses when it is my tenant's JOB to ensure the rent is paid in full, on time, every time?

The answer is I have HAD IT!

ZT = pay or bye bye. No.....exceptions.

Do with that whatever you like. It's your business. We're still friends.

Btw, Robin made a good point when she said, "LEt the funeral parlor make a payment plan."

I can't think of a SINGLE BUSINESS that won't offer some sort of "time" for people to pay. So if they are all willing to offer time, why do they come to Roy with their sob stories?

Because they think you're weak and/or foolish.

No other business has to evict people over the course of 6 weeks, taking more losses. They simply cut off service.

No other business has to worry about a customer damaging their store and being unable to do anything about it because the police will say, "It's a civil matter."

Sid,

Sometimes I have play devils advocate just to make a point here. And BTW, my ZT policy almost identical to yours X + 7. You get to skip the P/Q notice which is something I wish could do.

Now, back to my original question. If your tenant was laying in a hospital bed (with a pulse), would YOU still file on the 8th day?

Although it's not required, I have a 5 day period in my agreement before the late fee is assessed. After that time, if the rent is not paid I file. Sometimes the 1st and the payday don't coincidence, so I build that consideration into the lease. Having given that consideration, I'm not inclined to yield others.

Roy, what part of ZERO is still not clear? ;-)

YES!

-S i d, the "heartless" / "excuse-less" land lord

Keep asking and I'll keep "Yessing."

Let me now ask you....

If your tenant were lying in a hospital bed with a pulse, when would you evict...

5 days late?

10 days late?

30 days late?

120 days late?

Never?

What if you had one tenant in the hospital with a pulse AND one tenant who is a single mom with a job loss with 3 kids with autism AND one tenant who is an Iraq War veteran suffering from PTSD AND one tenant who is recovering from open heart surgery at home and ran out of savings?

In short, what if about 20%-25% of your tenants were non-payers for "legit" reasons? Would the number of non-payers shorten the total time you are willing to be lenient? How would that be fair vs. if you only had one non-payer? What criteria would you use to award Tenant A 2 weeks vs. Tenant B a month?

What if you were having a family/personal emergency and needed every dime of rent to pay for treatments to save the life/health/well-being of yourself or someone you love?

Finally, the only question worth answering: At what point does Roy's need to collect the rent out-weight one or possibly multiple tenants' needs for leniency?

Maybe.

If I have an excellent tenant and they contact me before rent is due with a really good reason, and they have a plan about when I will get paid, I will agree to that, perhaps as often as once a year.

I went against the best real estate professionals advice to maximize my bottom line, income. I did "NOT" practice Zero Tolerance. In 1997 and 1998 at the bottom of the real estate decline I purchased dozens of apartment units. These were buildings that had bad management, no credit checking and unknown occupants. What most landlords would call a real nightmare.

Instead of evicting the tenant who couldn't pay their rent on time and in full, I worked with my tenants -- otherwise I'd have a 50% vacancy.

So in the first few months I changed from 50% not paying their rent to 70% paying their rents by the 5th of the month and 20% more paying by the 15th of the month. I had only 10% of the tenant not paying their rent in full each month. A big improvement.

So since I'm a contractor with a team of employee's, I evicted the worst non-payers and then fixed up that unit and put it back on the rental market getting a better class of tenant with income, credit and savings.

My fellow landlords who couldn't learn from my advice suffered massive rental losses and either went bankrupted, had to sell their properties at a loss or borrow tons of money.

SO YES, when it's in the landlords interest to work with a tenant, then do so.....

Also, I never ever put myself in a position that without the rent I couldn't pay my obligations. I never needed my tenants to pay the rent, but they needed a roof over their heads so this gave me the ability not to be crazy, mean or vindictive.

I was in the hospital for 5 days and paying bills was not on my mind. Sleeping and trying to rest consume you when you start to feel better. I'm sure some of you have been there too. My creditors were sympathetic and waived fees.

My delineation is in the situation, car crash, hospitalization and the prior status is the tenant, upstanding, compliant, no prior drama. Life happens they present a plan to recover and follow thru. If they don't drop the ball it's all good and I have a tenant who really appricates me.

My tenants almost consistently pay on time or early. I had one tenant who paid one day late one month and used the excuse that he was on a college visit with his son. I told him OK but only this time. Guess what? The next month he was late again. So, I let him know that he would not receive the discount this month and he had to pay the full undiscounted rental amount due. In his email, he tried to give me a sob story of only having enough for his family until Friday and couldn't pay. He finally relented and paid the undiscounted rental amount.

Roy, Ok Ok...blame me! I started this ZERO TOLERANCE buzz. (2 or 3 years ago!)

I wish I could find a "politically nicer" term but I needed something my Wifey and her helper would understand. ZERO!! It still took over a year for them to get fully on board.

They would keep kitting me with BUTs - "But his kid is sick" "But the factory is shut down for inventory" and any other excuse...er...REASON to justify not paying on time.

Pre-ZT we would brag on how much we were bringing in with late fees. But when I finally put a pencil to it we were LOSING money, even with the late fees, because they eventually stopped paying.

If a LL will take a little time to follow up they will find most of those excuses were LIES! Like the old "My Granny died" five times. Then you do the move out and find a box for a new 72" tv.

I drove by one today who had TOLD US they would be paying late (we said "But where will you go? The atty will file eviction on Tuesday! They paid.) 2 shiny new cars with temporary plates parked in the driveway! 2!

Late payment is the tip of the iceberg. Something is wrong at their house and soon you will be evicting for non-payment. Yes, even he nice little old lady who has paid her rent on time for 17 years. Her excuse for being late tells you she is out of money and out of friends to cover the rent. We did nto knwo she was having trouble becaseu she tapped her friends and church for the last 2 months of rent. We thought everything was fine.

AUTODRAFT eliminates A LOT of this trouble.

When they say "Can you work with me?" they are instantly on PayDayRent - weekly. This helps A LOT.

Now that we are fully ZT we dropped from 26 lates every month to 2 last month. One was a mixup on s brand new autodraft - got paid. The other is our only eviction for the month, down from an average of 4 per month before ZT.

Here is the *Golden Nugget* on ZT: They pay.

It's that simple.

It's the LL who let's the rent slide, not the res paying late.

One of my students recently did ZT at my insistence. 16 lates, sent 3 day texts, 14 paid now, 1 paid in 4 days, 1 skipped. He was skipping anyway, so now they can re-rent his place. Results from ALL 16!

It works.

To answer your original question, yes. 3 day notice then file. His parents will pay the rent if he has no savings.

Also, my lease is clear: new res provides a credit card backup for rent if their checking is empty.

BRAD

Thanks Brad20K for your reply. I was thinking of you (and Sid) when I made this post. I was trying to figure out if there were any 'kinks in your ZT armor' which apparently there are not any.

Sid - Yes, I would evict the tenant laying in the hospital bed,..why?,...more than likely, he was driving intoxicated and caused the accident.

"I'm sorry this is happening to you, but the rent is still due." Repeat, repeat, repeat.

My lease says, Due on the first, late after the 3rd and on the 5th they get the P or Q; which in IL is 5+1 day for service. So, technically, they have until the 11th to get the rent and late fee to me.

And yes...I would file on the 12th.