Repaying back rent

As a property management company we inherit a lot of situations where a tenant owes an owner several months’ worth of back rent, plus any late fees, utility charges, and other charges.  This situation is really more common than one would think.  It is amazing how many owner-landlords allow tenants to fall behind multiple months without enforcing the lease that they signed.

When we find a tenant who owes many months of back rent we do not automatically evict them.  We strive to be a “kinder, gentler” property management company.  In such situations we negotiate a repayment plan with the tenant.  Our attitude is “Well, you haven’t screwed us over so we aren’t going to screw you over.” 

But we keep the tenant on a very short leash.  They are firmly advised that one hiccup on the repayment plan will cause us to move for eviction.  We explain to them we aren’t going to mess around — this is serious business.  After a repayment has been successfully negotiated, we write it down and have them sign it.  Part of that signed agreement are the following terms and conditions:

  1. If you stick to the payment plan we may waive some or all of the accrued late fees while you are making agreed-upon payments.
  2. While making scheduled payments, we will suspend late fees as long as payments are being made as agreed.
  3. Payments received will be applied to oldest charges owed first.
  4. If you miss any scheduled payment then we will proceed immediately with eviction with no recourse except full payment.
  5. In most cases the repayment plan will not be extended beyond a 6–month time interval, meaning all monies should be repaid within 6 months.
  6. If the repayment plan is not met at any time for any reason whatsoever we reserve the right to charge and pursue the full amount of late fees and other charges allowed by law and your lease,
  7. Any offer to waive late fees or other charges is conditional upon the performance to the terms agreed upon. In the event of failure to meet those terms and/or we proceed with eviction all late fees, notice posting fees, and other charges will apply.
  8. A written, signed Repayment Plan will be executed by both the tenant and Full Service Property Management.
  9. These terms are subject to change by 10-days written notice by either party and mutual acceptance of both parties.

Once the agreement is signed it is up to the tenant to decide what they want to do.  If they want to continue living in the unit then they know exactly what performance criteria must be met in order to continue doing so.  Anything else will result in them moving.

You can find on our website the full context of our policy towards tenant repayment.  Full Service Property Management is a Seattle-based property management company specializing in residential property management for houses, townhouses, condos, small apartments, and HOAs.  To learn more about them, visit them at www.fullservicepm.com.

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