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Dealing with Rental Arrears: A Guide for Landlords

Rental arrears are an unfortunate reality that many landlords face at some point. When tenants fall behind on rent, it can put landlords in a difficult financial position. However, there are steps landlords can take to minimise and recover rental arrears.


Understanding Why Rent Hasn't Been Paid


The first step is to understand why the tenant hasn't paid their rent. Connect with the tenant to discuss their situation. Are they facing temporary financial hardship? Or is there an ongoing issue? With open communication, you may be able to work out a payment plan or other solution.


Follow Up in Writing


If you can't reach the tenant, follow up in writing to request payment and warn that continued non-payment could lead to eviction proceedings. Send the letter via certified mail to have proof it was received. You may also want to loop in a guarantor if the tenant has one.


Review Your Options

If the tenant still does not pay after written notice, you may proceed with eviction by serving the required notices per your location's landlord-tenant laws. Be sure you have solid documentation of non-payment and notices served in case the eviction goes to court.


An alternative is small claims court to recover the owed rent money. You typically have up to 6 years to pursue these damages. However, recovering the judgment can be difficult if the tenant has limited assets.


Protect Yourself with Insurance

Landlords should also look into rental income protection policies, which provide reimbursement if a tenant stops paying rent. This coverage helps replace lost rental income during eviction proceedings or vacancy periods. Just be sure to follow all requirements of the insurance company, like tenant screenings and proper notices.


Preventing Arrears


While arrears may be unavoidable in some cases, there are proactive steps landlords can take to minimise the risk:

  • Thoroughly screen tenants for eviction history and ability to pay rent

  • Collect security deposits in permitted amounts

  • Make rental payments convenient with online payments

  • Act quickly at the first sign of late payment

  • Maintain the property to prevent disputes over unmade repairs

  • Build positive relationships with tenants to facilitate communication


Dealing with rental arrears takes time and diligence. But by understanding all your options as a landlord, you can limit the financial impact and recover what is owed. Reach out for guidance if you are unsure of the proper next steps.



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