A little unconventional wisdom regarding late rents. Your rent is late, should you be concerned? Odds are you have a problem and are headed for an eviction, but here’s something to think about.
If the tenants credit score is 700+, they are probably just absent minded and need a reminder. Once they get the automated payments set up, or a monthly text from you, you will not have a problem. The anticipated delinquency rate is ~5%.
If their credit score is 650 – 699, they may be trying to pull something, and they may be having issues. But odds are, they are probably just a bit sloppy, and disorganized and not much of a reason to be concerned. The delinquency rate can be expected to be ~15%.
If their credit score is 600 – 649, they probably are starting to have an issues, and will probably be late a bit more often if there is an issue. They’re at least going to try to keep the rent payments timely, but issues may still result. Keep your eye on them, don’t give them too much slack, and you should be OK. The delinquency rate can be expected to be ~31%.
If their credit score is 550 – 599, they are trying to pull a fast one on you. Don’t let them take you for more than the law allows. It may get better, if you still believe in Santa. I bet this is not their first eviction. Odds are, they had slow rent payments right after the first moth. The delinquency rate can be expected to be ~51%.
If their credit score is 500 – 549, they are lying and must go. It will not get better from here. If you have a two month’s of a deposit, good for you. Get them out before the deposit is used up. You should have passed on these renters, once you see the damage left behind you will wish you would have. The delinquency rate can be expected to be ~71%.
If their credit score is less than 500, you have a fool for a property manager.
Have you ever been late with your rent? If so, where do you fit in the above list? If you have tenants that are late on rent, where do they fit in on the list?