Property Management Rental Legal Forms

Collecting unpaid rent is part of the property management process. The trick is to not let the situation get out of hand, says Massachusetts's collections attorney Phil A. Taylor. The first month a tenant falls behind in the rent, you need to take action.

While it's important to respond quickly, Phil says you want to avoid face-to-face contact because it could lead to confrontation. The better alternative is to send a letter to the tenant, and because it's not one of the legal forms in your library, it doesn't have to be sent certified mail. Any letter that has the correct address and postage is considered received once it is mailed. The body of the letter should instruct the tenant to call you so that the matter can be resolved.

If the tenant offers you a partial payment, Phil recommends that you accept it. However, it is important that you give the tenant a receipt that clearly states that what you received is only a partial payment, and that you still have the legal right to collect the rest of the unpaid rent.

You may also feel that effective property management techniques require you to investigate how serious your tenant's financial crisis is. That means checking to see if they're still employed, and how much other debt they're carrying. Phil says that if your original rental agreement doesn't prevent you from calling the employer listed, you can do so to see your tenant is still working for the company.

Also, as long as you maintain a debtor-creditor relationship with your tenant, the Fair Credit Reporting Act allows you can to get a copy of the tenant's credit report. Legal forms like your rental application usually have a release allowing this.

Although you can get this information, Phil says it really won't do you much good. Even if the tenant is unemployed and is carrying a huge debt, if they pay the rent they can't be evicted. The only value that information might have in terms of property management is if you use it to decide how much leeway you are willing to give them.

The real problems start when you've put off collecting back rent and the tenant is still in the apartment. Your only choice is to start eviction.

You begin by sending your tenant a Notice To Quit, which IS one of the legal forms in your library you have to use specifically. The letter tells your tenant how much time they have to pay the back rent, typically 3 to 14 days according to state law. If the tenant pays, they can stay, but if they don't, they must vacate.

Should your tenant leave still owing you back money, you're going to have to collect the debt some other way.

The Fair Debt Collections Practices Act (FDCPA), which protects consumers from abuse from debt collectors, says that a landlord acting on their own behalf isn't subject to the provisions of the law because they aren't considered a debt collector. However, even though you aren't subject to the law, you can't engage in any of the abusive practices the law prohibits.

Employees of property management companies aren't considered debt collectors under the FDCPA either because the rental payments aren't owed to another individual or entity. But if at any time during the collection process the landlord/property manager mentions any name other than their own, that means that a third person is collecting the debt, and the landlord/property manager becomes a debt collector subject to the FDCPA.

If you can't collect on your own, you will probably have to sue for the amount owed under breech of contract. An attorney familiar with your state's collection laws and the necessary legal forms required to sue should be contacted.

Maria is a real estate writer, property manager, and long-time real estate investor who contributes content to a wide variety of real estate publications, both on- and offline. For online property management software and help, EZ Landlord Forms can help out and provide you with the legal forms necessary for eviction and the right to collect back rent in your state. Good luck collecting that back rent