I believe the property owners with investment properties, no matter if you’re self managing them or through professional property management teams, you’ve probably encountered challenges with tenants failing to pay rent on time. In this video, we dive into the procedures and strategies for effectively addressing late rent payments to minimize potential losses for our landlord clients. If you’re interested in this topic, don’t miss out!
Procedures while dealing with rent arrears
Before tenants move in, we collect a two-week rent deposit. For instance, if move-in date is on 1st of July, we require the tenant-signed lease agreement, bond lodgement, and deposits totaling two weeks’ rent plus a four-week bond before this date. Keys are handed over on the lease start date, with subsequent payments due based on weekly, fortnightly, or monthly rent cycles. In the event when payment is not received by the end of the rent cycle, Midas team will send a reminder email to tenants the following day. If arrears persist beyond 7 days,we will take action on the 8th day with the issuance of a Form 11 – notice to remedy breach.
Tenants are given an additional 7 days to settle overdue rent. If by day 14 they have not fully cleared the past two weeks’ rent, a Form 12 – Notice to leave will be issued on day 15. Even if tenants settle arrears after day 14, landlords retain the right to terminate the tenancy to prevent recurrence.
After issuing Form 12, tenants have 7 days (which is day 15-21) to vacate. If tenants failed to move out on day 22, we initiate an urgent QCAT application for possession warrant to evict tenants and remove their belongings.
Landlords may worry about rent owed if tenants disappear with their belongings. In this case Midas will apply to QCAT to use the bond initially paid to cover the rent shortfall. If the bond doesn’t fully cover the rent owed, the importance of landlord insurance, as emphasized in previous videos, comes into play. Insurance can cover rental arrears if timely responses and necessary documentation are provided throughout the process; otherwise, claims may be denied.
In special circumstances like domestic violence, financial hardship, or bankruptcy that affecting rent repayment, tenants can appeal to QCAT. Final decisions in such cases are determined by third-party arbitration, often resulting in a 50/50 split between landlords and tenants or negotiating a payment plan.
How Midas team stands out in managing Rent Arrears
Wondering how our Midas Leasing team mitigates rent arrears? We rigorously screen applicants based on income stability, rent-to-income ratios, and verify references from prior landlords or property managers. Ensuring landlords’ peace of mind, we facilitate the application and submit claims from landlord insurance to handle unforeseen tenancy challenges.
Conclusion
That’s all about how we deal with rent in arrears. I hope this video has been helpful to you, see you next time!
