Notice of Continued Late Renral Payment

Updated March 2021

What do you do when your tenant is behind on rent, and you're left wondering how exactly to handle a late rent notice? It can feel very awkward to send out a late rent notice to tenants you like. Nothing strains a relationship quite like someone owing you money.

It's important to remember you are a landlord in this situation and your business relies on you to act quickly and efficiently. Allowing tenants to consistently pay rent late may seem like the nice thing to do, but it could also be causing you unnecessary losses.

In this guide, we'll discuss everything you need to know about late paying tenants and how to properly serve them a late rent notice.

A Table Of Contents For Late Rent Notice

Learning when and how to use late rent notices doesn't need to be a difficult task. Break down this process into manageable pieces as you understand the ways of handling late rent payments:

• What Is A Late Rent Notice?
• Late Fee AND Pay Or Quit Notice Templates
• Late Rent Notice Template
• 3-Day Pay or Quit Notice Template
• Which Notice Should I Use And How Do I Deliver It?
  • Why Some Landlords Choose The 3-Day Notice
• Standard Late Fee For Rent
• How Many Months Late On Rent Before Eviction Happens?
• FAQs On Late Rent
  • How Do You Write A Late Notice For Rent?
  • How Many Days Late Can Rent Be?
  • What Happens When A Tenant Is Late On Your Rent?
  • How To Serve Tenants Who Pay Late
  • Can A Landlord Evict A Tenant For Late Payments?
  • Can You Evict A Tenant For Being Two Weeks Late On Rent?
  • How To Handle Late Rent Around The Holidays
  • Can Landlords Charge a Flat Fee for Late Rent?
  • Should Landlords Allow A Tenant To Split Rent Payments?
  • Will Late Rent Show Up On A Credit Report?
• Late Rent Notices Keep Business Moving

You can click any of the links above to jump to that topic on this post.

Below we've also included downloadable notices you can use. We'll explain how to use these in the video you'll see further down this post.

What Is A Late Rent Notice?

A late rent notice is an official document that notifies the tenant they are late with their payment of rent. The late rent notice clearly communicates that the tenant is late on rent (according to the rules laid out in your lease) and formally informs the tenants of next steps.

Your late rent notice should detail how much is due, any fees that will be incurred, and when rent is due.

A late rent notice is also called a "Pay or Quit" notice or a "Pay Rent or Quit Notice." These should always be served before an eviction notice.

Late Fee AND Pay Or Quit Notice Templates

Do you have a general idea on how to handle late rent but need a late payment notice template to help you finalize the process? These free templates by RentPrep can be used by landlords looking to serve notice to late-paying tenants.

• Late rent notice
• 3-Day Notice to Quit – All States Except CA
• 3-Day Notice to Quit CA only
• 5-Day Notice to Quit – All States Except CA
• 5-Day Notice to Quit CA Only

Late Rent Notice Template

Your late rent notice should include all of the following:

• Date
• Rental address
• Tenant name(s)
• Language explaining that rent is late and how much is due
• When fees will be incurred by
• Acceptable forms of payment
• Landlord's signature

You can download our late rent notice PDF here.

For your easy reference, here is what that late rent notice template PDF looks like.

Notice of Past Due Rent

Date: ____ /____/____

Rental Address: ____________________________________________

Tenant Name: __________________________________
__________________________________
__________________________________
__________________________________

This notice is to inform you that your payment for te month ________ in the amount of $_____________ has not yet been received and is now considered past due.

If the rent is not received by __________, a late fee of $___________ will be applied.

Rent to be paid by cash, check, or cashier's check and made payable to _____________.

Thank you,

____________________________
Landlord

3-Day And 5-Day Pay Or Quit Notices

A "3-day notice to pay or quit" is essentially a more official late rent notice. The document indicates that the tenant has 3 days to pay or they must quit (be removed from) the rental property.

Some states require you to provide the tenant with a warning in the form of a late rent notice before issuing the 3-day pay or quit notice.

The State of California also offers a 5-day pay or quit notice option. But in whatever state you are located, you can choose to serve it.

What is important is to make sure you follow your local laws when deciding which form to use.

Which Notice Should I Use And How Do I Deliver It?

When presented with different options to let a tenant know that rent is late, landlords may not be sure which form they should use. These are the simple steps to determine which form might be right for your situation.

1. Consider Applicable Laws
   Your local landlord-tenant laws may outline the type of notice to serve in a specific situation and how it should be delivered. Check these laws first, and become familiar with them.
2. Check Your Lease Agreement
   Does your lease agreement inform tenants what will happen if their rent payment is late? If you mention a specific process, make sure to follow it.
3. First Time? Consider A Late Rent Notice
   If #1 and #2 above are not applicable, you will likely want to send a late rent notice for first-time offenders. This notice is not bound to eviction or any other progression of the situation, but it does act as a reminder for tenants.
4. Repeat? Use The Pay Or Quit Model
   If the tenant is very late on rent or a repeat offender, it's best to use the pay or quit notice. This notice lays the grounds for sending an eviction notice, if and when necessary, and can have direct legal consequences, so it can be used to upgrade the handling of the situation.

When delivering any type of past due rent notice, be sure you are able to keep a record of how and when it was delivered. The best method is to mail the notice with signature confirmation so you have documentation of the notice being received.

Why Some Landlords Choose The 3-Day Notice

On our Facebook Page, we have a video series called "Ask A Property Manager." In the series, Andrew Schultz, who manages over 120 doors in the Buffalo, NY area, answers questions from members of our private Facebook group of over 11,000 landlords and property managers.

In episode #35, he walks us through why he stopped using a late rent notice and started going straight to the 3-day notice to pay or quit form. (Kindly note the conversation picks up at around the 0:50 mark.)

Notes from the video:

Landlord Goes Directly To The 3-Day Notice To Pay Or Quit Form

In his experience, Andrew found that a late rent notice was redundant because the 3-day notice to pay or quit already covers a tenant's late payment. However, he stresses that he is able to skip the first step as the State of New York allows it.

Some landlords go the route of …

1. Late rent notice
2. 3-day notice to pay or quit
3. Eviction notice

Andrew believes you're adding an extra step with the late rent notice, unless your state specifically requires it.

He individually mails a 3-day notice to pay or quit to everyone who is on the lease via certified mail and first class in addition to posting the notice on the door. This method is sometimes referred to as "nail and mail."

If the tenant is at the point where they are late on paying rent, the "3-day notice to pay or quit" will get you moving faster towards collecting rent or proceeding with an eviction.

Wait a full four days before following up with an eviction notice, so you're not caught up in any technicalities on if it was actually a full three days.

Standard Late Fee For Rent

Some states such as Texas and New York State require you to charge a "reasonable" amount for late rent fees while other states are more specific.

The state of Florida says, "A facility or unit owner may charge a tenant a reasonable late fee for each period that he or she does not pay rent due under the rental agreement… For purposes of this subsection, a late fee of $20, or 20 percent of the monthly rent, whichever is greater, is reasonable." (For more information, see 83.808.)

This is why it's important to research your state's late fee policy.

These are the items you should consider when charging a late fee in your state:

• When can I legally begin charging the fee?
• Is my late fee policy enforceable if it's not mentioned in the lease?
• How much can I legally charge for late rent?
• Does my late fee policy play nice with rent control laws?
• Does my state have any sort of grace period for late rent?
• Is the tenant withholding rent due to unfinished repairs?

These questions are mostly answered by looking at your lease and reading up on your state laws.

If your lease does not address a late fee policy, you cannot charge a late fee. In this instance, you'd want to insert an addendum to your lease on your policy and have your tenant(s) sign it. Back to the question at hand …

Here's a screenshot of landlords debating how much to charge for late rent in our private Facebook Group.

How Many Months Can A Tenant Be Late On Rent Before You Can Evict Them?

If your tenant is more than a month behind on rent, you need to begin the eviction process.

Landlords can sometimes feel apprehensive about serving a "Pay or Quit Notice," but it's a necessary step to begin the formal process. An eviction can take months, so you don't want to delay serving a notice.

The "Pay or Quit Notice" lets your tenant know you're serious about collecting rent. The notice gives them a specified period of time (3 days in many cases) to pay both the rent and late fees to avoid an eviction.

If rent is due on the first of the month, then it is late on the second.

Typically, you'll want to serve the "Pay or Quit Notice" on the second and your state will determine the number of days the tenant has to pay or quit. If your tenant does not pay by the specified date, they'll be removed from the property once you go through a formal eviction process.

We recommend RocketLawyer's Pay or Quit notices as they are specific to each state's laws. The firm's attorneys provide online legal advice on eviction of tenants according to the laws of your state.

FAQs On Late Rent

How Do You Write A Late Notice For Rent?

To write a late notice for rent, make sure to include the following information:

• Date
• Rental address
• Tenant name(s)
• Why the letter is being sent
• How much rent is due
• When fees will be incurred by
• Acceptable forms of payment
• What will happen if rent is not paid
• Landlord's signature

Remember, this is not a formal notice that can lead to eviction. It is a late rent payment letter.

While it is an official document, you will still need to send a late rent formal notice to pay or quit if the tenant does not pay so you can kick start any legal action that is needed.

How Many Days Late Can Rent Be?

A grace period is a period of time after rent is officially due during which a tenant can still pay rent without serious penalties.

Many states mandate an official rent grace period during which tenants are allowed to pay late without it being considered as eviction-worthy. Whether or not late fees can be applied when rent is paid during the grace period is dependent on the state.

Texas requires a two-day grace period on rent; other states do not offer this provision.

The best way to make it clear for both you and your tenant is to research whether or not a grace period is applicable in your region and put it in the lease terms. Some landlords even choose to add a one- or two-day grace period to their lease, even when it is not required, as a means of making things a little bit easier for their tenants.

What Happens When A Tenant Is Late On Rent?

When a tenant is late on rent, every landlord has their own method of handling the situation. Generally, the process looks something like this:

1. The landlord reminds the tenant that their payment is late, either verbally or through a formal written notice.
2. If the tenant doesn't pay the rent within the rent grace period, the landlord would send either a 3- or 5-day notice to pay or quit.
3. If the tenant does pay rent, but they incurred a late fee in the meantime, the landlord sends a late fee for rent notice to alert them to this fee immediately.
4. If the tenant doesn't pay the late fee by the due date, the landlord can then file for an eviction case with the local court and begin the eviction process.

Do you know what you will do if a tenant doesn't pay rent? Now is a great time to get your plan ready.

How Can You Serve The Pay Or Quit Notice To Tenants Who Pay Late?

Here's an example timeline to follow when serving your tenants. This example is for states with 3-day notices and rent due on the first of the month.

Again, be sure to check with your local laws before beginning this process. Some of the details may vary depending on them, and it is important that you adjust your plan accordingly.

1. When Rent Is Due

Rent is due on the first, late on the second, and the tenant should be served with a pay or quit notice on the fourth.

2. Serving Notice

All residents with any amount of rent due are served a three-day notice to pay rent or quit (NPRQ) form.

These forms must have the complete, legal name of each and every "ADULT" resident on it and be accurately filled out. If the forms are not filled out properly, the court will have to start the process over again and this could amount to losing three months of rent.

These forms must be personally handed to an adult and must never be handed to a person who is 17 years or younger. They can be handed to anyone in the apartment as long as they are 18 years of age or older.

Alternatively, you can deliver the notice via certified mail so you have proof that the tenant received a copy of the notice. You should keep the original copy in case you need to file it with court documents later on.

3. Do Not Accept Payment

Only accept payments in full once the 3-day pay or quit notice is served. If partial payments are accepted, then the whole process will have to be started again.

4. Start The Eviction Process

On the sixth day of the month, you should gather the following documentation and prepare to file for eviction with the local court system.

• The original 3-day notice to pay rent or quit
• The original Declaration of Service (NPRQ and Proof of Service must have identical names and dates)
• Copy of the application (completed at the time of move in)
• A signed copy of the lease/rent agreement
• Indicate any rent increases, like if the rent is now higher than the rent stated in the lease/rent agreement. This can be done by including a copy of the Rent Raise & Change of Terms
• Indicate any change of terms in the rental agreement (or include a copy of changes)

5. Continue To Refuse Partial Payment

At this time, do not accept any partial payments; accept only payments in full! If a partial payment is accepted, the whole process must be started over. This can lead to big losses and major slowdowns in your business.

Can A Landlord Evict A Tenant For Late Payments?

Yes, it is possible to evict a tenant for late payments.

Most states allow landlords to serve a notice to pay or quit the property. This means tenants who are late on rent payments must pay up or leave the property before the deadline. If they fail to pay their rent, you can move forward with eviction proceedings.

Can You Evict A Tenant For Being Two Weeks Late On Rent?

Whether or not you can evict a tenant for being two weeks late on rent will depend on the state you work in. Most states, however, might allow evictions for late rent payments of more than just a few days' grace period. A notice of 3 to 5 days is required before eviction proceedings can begin.

To be sure about your circumstances, check local landlord-tenant laws and find out the required period for eviction after late rent payments.

How Should You Handle Late Rent Around The Holidays?

It can be a tough situation when a tenant asks about paying rent late around the holidays due to increased bills.

Unfortunately, this can lead to a situation of "give an inch, they'll take a mile."

If you bend your rules with your tenant on special occasions, you're opening yourself up to other future requests. The easiest thing to do with this sort of situation is to remind your tenant of your late fee policy, and stick to it.

You should be consistent with the way you screen your tenants and also the way you enforce your policies. If you deviate, you could be accused of discrimination in that you may have bent the rules for one tenant and not another.

Stick to your policy. If you treat a non-paying tenant as a non-priority even for one month, that's what it will become … a non-priority.

Can Landlords Charge A Flat Fee For Late Rent?

Many landlords charge a flat fee for late rent, and it is often paired with the daily late rent fee. For example, a landlord might have a $50 flat fee if the rent is not paid by the first of every month and then charge $5 fee per day until it's paid.

States that enforce maximum late fees that landlords can collect often structure it so the flat fee and the late days combine until they meet the limit. For example, a landlord might charge $45 after the fifth of the month, plus $5 per day until 10% of the rent adds up because their state law allows just up to 10% of the total rent to be collected as a late fee.

Should Landlords Allow A Tenant To Split Rent Payments?

Landlords everywhere struggle with collecting rent money from their tenants. They have also heard just about every excuse for why the payment is late. Sometimes, tenants offer to make split payments for rent, but is this good for landlords?

Before landlords accept split rent payments, there are several things they need to consider. This video helps explain some of the reasons:

The bottom line is that when tenants give excuses for paying the rent late, it should be a warning sign to landlords that they may be looking at months and months of late rent. For most savvy landlords, they don't allow a tenant to split rent payments.

Will Late Rent Show Up On A Credit Report?

If you are processing rent payments through a rent portal that reports rent to the credit bureau, late rent payments could show up on a credit report. The exact way it would show up is dependent on the specific credit report used.

FICO scores do not include any rental history, even if it is on file, while Vanguard scores do.

Late Rent Notices Keep Business Moving

As awkward or frustrating as it can feel at times to send out late rent notices, there is no doubt that using these notices is going to be necessary from time to time. Landlords who never ask for the rent they are owed may never get paid, and that would be bad for business.

To keep your business going, be organized when approaching late rent payments:

• Make sure the terms of rent payments are clear in your lease.
• Give tenants a head's up when they are late.
• Send out clear and appropriate past due notices according to the exact situation.
• File for eviction if the tenant does not comply.
• Act quickly.

It's never fun to chase down a tenant just to get the rent paid, but it is an unfortunate part of the rental business at times. To avoid facing this situation again in the future, make sure to run a background check on your prospective renters in an effort to get the best tenants.

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Source: https://rentprep.com/collecting-rent/late-rent-notice/

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