As a landlord or property manager, you know that getting your tenants to pay their rent on time is key to keeping your business running smoothly. If you’re having trouble getting your tenants to pay, it might be time to write them a rent collection letter.
In this blog post, we’ll give you some tips on how to write a rent collection letter that will get your tenants’ attention and help you get paid on time.
- Don’t delay, and act consistently when dealing with late payments. As the landlord, it is up to you to enforce the rent payment policies and ensure they are followed.
- Remove emotion from the situation. Even if your favorite tenant is behind on their rent, you need to remember that this is your business, and you need to set a path for others to follow.
- Become an expert with your state’s and city’s regulations, especially if evicting a tenant. Failure to abide by the laws could result in delays, termination of the whole eviction process, and more.
- Put everything in writing. This will come in handy if you need to go further with the legal process.
Why send a rent collection letter?
Landlords will sometimes have to write a rent collection letter to advise a tenant of nonpayment of their rent. This collection letter acts as a formal notice and attempts to retrieve the outstanding amount. Rent collection letters should include the description/details of the missed payment, when it was due, the owed amount, and any other important information.
A tenant’s rental agreement is the first place to look if you think they are late on their payment. Though many states don’t legally require grace periods in leases when paying rent, often, there is a clause in the lease giving the tenant a 3- or 5-day period where they can pay after the regular due date. Check the tenant’s lease thoroughly before taking action.
A rent collection letter can be a landlord’s best ally as it can help you legally if you take your tenant to court. Depending on your state’s rules, sending a collection letter is both a courtesy and a requirement. By sending a collection letter, you are putting the tenant on notice while also protecting yourself by creating a record.
How to write a rent collection letter
Writing a rent collection letter can be stressful for a landlord, especially if they have never written one before. There are a few tips you can use to help you get started:
- Write the letter in a business format and make sure to date it.
- Include first and last name as well as the contact information of yourself and the tenant.
- There should be a subject line that makes it clear what the letter is regarding. This can contain the outstanding amount, due date, or other important information.
- The letter itself should be concise and no more than 3 paragraphs. Keep the tone serious but not aggressive. Avoid using legal jargon and complicated terms.
- Offer ways the tenant can pay the overdue rent (i.e., online, check, etc.).
In the first paragraph, you should advise the tenant about the amount of rent owed and when it was initially due. Take this time to make your reasons for writing clear without overexplaining your side.
The second paragraph will include more context, such as your terms and conditions as listed in the lease. You can also add a reminder to the tenant of the signed clauses.
You should wrap up by providing a date for payment. Include the repercussions if your tenant still does not pay the owed rent, including a warning of possible legal proceedings if the issue remains unresolved.
Free rent collection letter template
You can use a rent collection letter template if you need to collect rent from a tenant. This template can help you get started with writing a customized rent collection letter. You’ll need to include information about the amount of rent owed and any late fees that may be incurred. Be sure to read through the template carefully, so you don’t forget anything important.
This free rent collection letter template is available in Google Docs and Microsoft Word, so you can use the program you’re most comfortable with. And because it’s customizable, you can tailor it to fit your specific needs:
Download for Google Docs
Simply select the link and download it to your device (or make a copy to edit it online). Then, after you open the document, save it by another name so that you always have the original template to go back to.
Best practices for sending a rent collection letter
There are several ways a landlord can deliver a rent collection letter to a tenant, each with its pros and cons. One option is to hand-deliver the letter directly to the tenant. This has the advantage of ensuring that the tenant receives the letter immediately, but it can be awkward or confrontational.
Another option is to send the letter by certified mail, which requires the tenant to sign when they receive it. This ensures that the tenant cannot claim they never received the letter, but it can be expensive and time-consuming for the landlord.
A third option is to email the rent collection letter to the tenant. This is a quick and easy way to deliver the letter, but there is no guarantee that the tenant will receive it or read it. A fourth option is to post the rent collection letter on the door of the rental unit. This is a very visible way to deliver the letter, but it does not provide any proof that the tenant received it.
Which option is best for a landlord depends on the situation. In general, hand-delivering or sending the letter by certified mail will be the most effective way to ensure that the tenant receives the letter and knows that they are responsible for paying rent.
However, these methods can also be more confrontational and may not be appropriate in all situations. Emailing or posting the letter on the door is less effective but may be more appropriate in some situations. Landlords should use their best judgment to decide which delivery method is best for each case.
Tips for writing a rent collection letter
One of the most important practices you can do when writing a rent collection letter is to be consistent. Have a clear outline of the terms of payment listed in their lease, along with the consequences if they miss a payment.
Here are 5 more tips to follow when writing a rent collection letter:
- Make sure you are clear about what is owed. Renters should know exactly how much is owed and when it is due. Landlords should avoid being vague in their communications to avoid confusion or misunderstanding.
- Be polite but firm. It is important to be respectful in your language and tone, but also remember that you are ultimately asking for money that is owed to you. Striking the right balance between politeness and firmness will help result in the best outcome.
- Do not threaten legal action unless you are prepared to follow through. Making empty threats will only erode your relationship with the tenant and make it less likely they will cooperate in the future. If you do need to take legal action, be sure to consult with an attorney beforehand.
- Offer a payment plan as an option. Many tenants may be willing to work with you on a payment plan if they are having trouble coming up with the full amount owed all at once. This can help you avoid eviction and keep everyone on good terms.
- Keep records of all communications. It is important to keep copies of any letters or emails you send to the tenant regarding rent owed and any responses you receive. This will help document your efforts in case you need to take further legal action.
If you think that your tenant has missed a payment, it’s important to do your research first before acting. Make sure to look at their lease beforehand and check to see what the rules and regulations of your county are. Once you decide to take action, it’s important to stay consistent with your procedures and treat each tenant the same way. This will help ensure that you’re fair to all of your tenants and that you’re following the law.