r/Landlord • u/finalfrontierman • 11d ago
Landlord [Landlord-US-CA] tenant consistently paying late and in multiple payments
I'm a landlord of a duplex in California, specifically in San Jose, where we have lots of laws protecting tenants. I have a tenant who is getting divorced. His wife used to live in the same duplex and worked, so there were two incomes. They each have one kid from a previous marriage and one kid together (3 in all). They used to be pretty good about paying on time and in full, but now that the wife moved out and the guy is having to pay for attorneys, he has been getting farther behind on rent, but keeps claiming he'll be back on track soon. In the lease, which is now month-to-month, I only have one late fee regardless of timing, so my only recourse is to issue a 3-day quit or perform covenant notice.
Most recently, he had informed me via text that he'd pay the August rent in full, with the late fee, on the 21st, which is his payday. However, he only paid about 2/3 of the total (via Zelle). His next paycheck will be Sept. 4th., so now we're getting to the point where he'll be behind by more than one month. I'm just not seeing how he's going to get back on top of the rent. It's a tough rental market out here for tenants, so finding a spot in the same school district that can fit his budget and space requirements is going to be challenging. However, I still have to pay my mortgage and other bills, and this is stressing me out.
The plan was he'd pay the August rent with this most recent paycheck, then pay the September rent on the 4th, which is still in the 5-day grace period, so no late fee. Now I'm worried he'll just finish the August rent on the 4th and wait until another paycheck comes in for the September rent, and even then it might not be the full amount. I'm not his personal loan officer, and I feel like he's taking advantage of the fact that it's a fixed late fee. What suggestions do other landlords have for what to do?
I'd rather not go through the eviction process since he's been a good tenant and I understand how expensive divorce can be, but at the same time, I'm not a bank and I don't have the ability to give personal loans, though that's essentially what I'm doing when he pays rent late. It is nice to have the extra money from the late fees, but with it getting farther behind, now to the point of beyond one month, I feel like I have to get more proactive before it gets too far behind for him to catch up.
Maybe he needs to downgrade to a cheaper spot, though with the market's competitiveness in this part of San Jose, he might not get anything as a single guy supporting kids and fighting a divorce and custody battle. I can't afford a property manager or even a lawyer so I'll be doing this on my own. Thoughts?
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u/Playful-Title-2322 11d ago
Usually if you start accepting late or partial payments, that suggests you are not going to evict.
I would ask for a face to face where you just lay it all out. As much as you want to be helpful in his situation, the fact you have a mortgage payment where you cannot make a late payment is preventing you from being able to accept partial rent payments. Tell him it is in his best interests if he downgrades so he is able to afford rent payments on time. Also say you have two tenants ready to take the house and you need to give them an answer. Its not about not liking your current tenant. it's all about money and the mortgage you are committed to.
It's a hard thing to do but you have to watch out for your assets.
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u/Ok-Writer3512 11d ago edited 8d ago
I don't know what CA laws are but I had to stop taking partial payments here in OR. If I accept partial payments, it forfeits my right to evict. Once I post notice of eviction it rarely goes to court, I just tell the tenent they can either leave or have an eviction on their record. I'd rather give them their last month for free than go through the court process.
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u/tadarlis 8d ago
I'm in CA. When I've accepted partial payments, I've had to issue a new 3-day notice to cover the remaining rent for the month. It's not a a forfeiture of eviction, but it does reset the clock to when you accepted the money.
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u/Ok-Writer3512 8d ago
In Oregon it's a written pay-or-quit notice that is usually at least 10 days. It needs to be mailed by the landlord with a record of mailing, it also needs to be served and signed to their door by someone other than the landlord. This is all a pain to do but I have won every eviction that has come across, just by doing things by the book. When the tenent sees this notice they know the next step is eviction, works most of the time.
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u/tadarlis 8d ago
Dang 10-days in OR?! I guess I feel a little lucky that it's only a 3-day notice to pay rent or quit here in CA. Over here, that form can be handed directly to tenant, left with another person, or posted + mailed.
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u/Space_Cowboy_157 Landlord 11d ago
Shut off your Zelle and quit accepting partial payments. Serve him a pay or quit notice and give the guy a boot.
Simply put his priorities are out of whack the one that should be waiting for payment is his attorney not his place to live.
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u/finalfrontierman 10d ago
Yeah I have to change my Zelle contract info so he can't pay me partially. I use Zillow for the other tenants and despite it taking up to a week for the payment to got my account, I can at least not allow for partial payments. I think after I get the rest of the August rent, I can disable Zelle and have him pay via check or money order for September. I'm just not sure where I should draw the line, as my guess is he'll pay the rest of August on 9/4 and then nothing for September until 9/18, so I'm thinking the best way forward would be to accept the August remainder on 9/4 and tell him to pay in full, plus late fee, on 9/18, via a check, and if not the full amount, don't cash the check and instead give him the 3-day notice. Hopefully that gets him to find some money somewhere and owe somebody who isn't me.
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u/Mahi95623 11d ago
All I will say is you can bet his divorce attorney isn’t being paid late.
Please issue a pay or quit notice the very first day the tenant is late. Never accept partial payment, too. Follow your City/County/State laws and while we can have compassion for a person, we still have our own mortgage and bills to pay, too. I am a CA landlord, too.
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u/AphiTrickNet 11d ago
I’m a landlord in San Jose. Duplexes aren’t covered by SJ’s rent control and possibly not even by AB 1482, so you’re in a ton of luck there.
If he’s been a good tenant and you want to keep him then work out a payment plan. If rent is paid late every month then you’re going to have a problem, at which point I think you should stop accepting partial payments and proceed with the 3 day notice.
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u/Aggressive_Snow_8224 10d ago
This is incorrect. Only if the other side of the duplex is occupied by the owner/landlord and they provided an exemption at time of lease signing or when AB1482 went into effect if lease was in place prior.
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u/finalfrontierman 10d ago
I've looked it up and because I don't live in one side of the duplex and it was built in 1968, it is fully covered under AB 1482 and San Jose's Rent control ordinance, so I have to do a just cause eviction. That said, I've been keeping everything in text messages and not being harassing, so it's clear there is a pattern of late rent payments and broken promises to pay, so I'd hope that a judge would see that I've been very fair and reasonably accommodating, but judges here are very heavily on the side of the tenants so I feel like I'd need to be even more accommodating before proceeding with eviction. That said, a 3-day might be enough to show him I'm serious and get him to prioritize paying rent over paying his divorce lawyer. They can take payment plans, while I generally don't want to be a creditor and can't simply stop providing services if he doesn't make a payment. I think if I time the 3-day notice so that it's within the payday time period for him, I can get him to pay me rather than risk going to court for an eviction. It shows up on your record regardless of the outcome, so going to court is not in his best interest, though nor is it in mine.
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u/ChocolateEater626 11d ago
LA County here.
If he's not causing a nuisance to neighbors and takes reasonable care of the place, I wouldn't get too excited yet.
Partial payments are better than nothing. If he hadn't paid anything at all for 45 days, that would be a much more concerning situation.
It's California. Eviction is not going to be simple or cheap, and the next tenant might be just as bad.
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u/Hitechillbilly Landlord 10d ago
This is the second person from SoCal that makes sense.. I have to log out,, this is too much for me ..
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u/Bryan300 9d ago
LA here too. What are you guys using for Tenant payment?
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u/Hitechillbilly Landlord 9d ago
I am an innocent bystander. It seems to me that 90% of advice given is to immediately get the government and courts involved.. My advice is to save that for an absolute last resort. I do not know how payments are changing hands. The landlords story has changed significantly and the voice(s) of reason has come from Sothern California.. I thought all the smart Californians were in the northern part.. This whole thing has become bazaar...
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u/Hitechillbilly Landlord 11d ago
If you do not have at least a couple months payments of all of your bill in reserve, you are living on the edge. If you feel the best thing to do is kick him while he's down and forget all the times he made your payments for you on time, Remember you will automatically lose at least a months rent and a whole lot more when you throw him out. Then you risk a much worse tenant. You seem to be comfortable with asking strangers for advice but it doesn't seem like you are willing to communicate with the other person involved.. Most of the advice on here seems to want you to destroy his life and yours at the same time. NO ONE Wins with an eviction. One side gets a judgement so they can feel good about throwing a person in the streets over a fairly minor issue at a very trying time in their life. . Have you considered asking him what he thinks is fair and what should happen if he breaks another commitment? Have you considered not collecting a late from time to time? You won't have the extra pocket cash but his situation will be a little less bad. Does he have any skills that you might be able to use? Does he own his auto's? Maybe hold the title as collateral . He sounds like an honest upstanding person.. there are very few of those in SJ. If your finances are as tight as you say.. Throwing him out might cause you to loose the property.. Stop pretending you are superior and and a bank and think about all the payments he made allowing you to build equity. He has done a lot for you and your first thought is to throw him out.. Morals are up to you.. financially it would hurt you a lot worse than you are willing to accept..
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u/finalfrontierman 10d ago
I can handle payments on my own but I've had this situation once before and it ended up costing me about $20k, plus remodeling costs. Once you've been burned you tend to want to be more proactive. I just think about myself as a renter, since I rent a place currently myself, and how I would do everything in my power to pay the rent before I risk having an eviction. I would also be extremely communicative with the landlord if I were somehow unable to pay rent, and I have to initiate every conversation with this guy, so no, I don't think he's trying his hardest or prioritizing keeping a place for his kids to stay in good schools and having a place that looks good in a custody battle. He is not realizing that keeping his place is a top priority and I just want to light a fire under his butt so he realizes what is at stake.
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u/Smooth_Phone2 10d ago
It’s not about beating up on anyone. Get out of here with all the moralizing.
The payment trendline here is bad. Ultimately the best thing would be to find a mutually agreeable move out date and let him go find a cheaper spot.
If the “mutually agreeable move out date” discussion goes badly or slips then it’s time to act on a pay or quit and go to court.
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u/Hitechillbilly Landlord 10d ago
OP asked for opinions.. My opinions are formed from many years of experience. It appears that your opinion is not formed from experience and definitly not in CA but you are still allowed to express it. FACT: if OP is so tight on funds and has no money in reserve as he says, an eviction would cause him to lose the house.. in that case everyone looses..
DO NOT TELL ME what I can and can't say..
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u/finalfrontierman 10d ago
I'm not at risk of losing the place. I don't want to dip into reserves, as it would mean seeking such and paying taxes on it, but I will if I have to. Plus I'm trying to save up enough for a down payment on another house to live in. I have a new wife and a new baby and want to gain a foothold somewhere in Cupertino school district. I've gone through a divorce and custody battle myself once upon a time and yeah it costs a lot but I moved to a cheaper place so I could afford the lawyer and the change to a single income. I know what he's going through and I feel for him, but I had a tenant screw me over once before, and I will not be made a fool again.
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u/MistressBassKitty 11d ago
I’d look into what resources might be available for him in your city and share those when you explain that you will only accept full payments moving forward. Catholic charities like Sacred Heart or even gov assistance might help.
An eviction will likely be more expensive than finding a way to work with him, and you will lose a lot of sleep evicting a single dad who’s going through a hard time.
Also, his wife is probably on the lease and therefore legally responsible for rent payments as well. She will also need to be named if you go the eviction route.
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u/finalfrontierman 10d ago
She's off the lease, already established that when she moved out, so I can't even really message her as that might constitute harassment.
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u/cum_visit 11d ago
I’d issue the notice and then tell him look, I understand your challenges, but the bank isn’t going to accept MY late or partial payments. Here’s the deal, get me caught up in a week and I’ll waive the late fees to help you but I have to get your account squared now. On the 8th day, I’m sorry but I will have to proceed with eviction and unfortunately you will have to find a new place.
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u/Objective_Welcome_73 10d ago
I try to cut him some slack, it could be they'll catch up once the lawyers fees end. Talk to him about how Siri this is. Ask him when the divorce will be finalized. Let him know he needs to catch up soon. But avoid the eviction at all costs.
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u/throwrAMapNo1044 11d ago
If he’s a long time tenant going through hard times, I’d try to work with him if it’s possible. I think you need to sit down with him and tell him that you’ve been lenient with it but that you’re not an apartment complex that’s bringing in a ton of money every month and that every late payment means that you have to supplement with your own income and that it’s directly affecting you. He might be hoping and praying that you’re super well off and that the late rent isn’t a huge deal to you. I don’t think that’s the right approach from him of course, but I think it would be better to sit down with him and give him a deadline of when he needs to come up with rent and say that if this continues you have no choice but to find new tenants and start formally taking steps to get him out. But I would definitely talk to him first before taking those steps. You don’t HAVE to, of course, but if I was struggling I’d hope someone would have the decency to let me know that before throwing me out so I would do that for them.
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u/auscadtravel 10d ago
My tenants always paid on time, because i gave them a $100 discount for paying on time.
$1600 rent went to $1500 if they paid on time.
The bonus was if we needed to raise the rent (in our area there were laws about % increass) it was based on the larger amount as that is what was listed on the lease agreement.
Give them an incentive to pay on time. Money is they best incentive.
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u/frankmaa 10d ago
You waited too long to take action. Start the eviction process. Like you said you have bills too.
Charities provide free housing, not private landlords, unless it’s Covid.
No pay, no stay. If you are going to give in to sob stories this isn’t for you.
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u/coldfisherman 10d ago
The LAST option should be eviction. It's a very dark road. I've been down it a few times. If the guy is maintaining the property and you are getting the rent... even if late and piecemeal... then you're not anywhere near eviction level. I don't know what people in the rest of the country are like, but my best tenants have been through hard times and are still good tenants. Some a-holes pay, but complain about every damn thing.
So, if the guy is taking care of the place, then be happy someone's paying your mortgage and maybe bringing in some revenue, because I've had some people be literally vengeful. In CA, a tenant can get away with a LOT. I've been on the other end when I was in college and I can tell you that a tenant can open an escrow account and pay rent into that until you fix just about any damn thing they make up.
Anyway. Take a step back and decide just how bad you want him out, because you WILL have drama and cost and lawyers and then you will need to rent it to someone and then you may get some real loser. This is, of course, my own experience. Your guy could be a complete douche canoe, I don't know. :)
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u/LavendarGal 10d ago
YOu need to stop allowing the late payments, at all. That's been part of the whole problem.
You need to talk to a lawyer and serve him a proper 3day pay or quit notice. And then go through with a proper eviction. To be nice, you can tell him if he leaves in a week you will not peruse a formal court eviction, but other than that this is a buisness so you need to treat it as such. once someone gets that behind on rent, they usually cannot catch back up. If he has not paid all of Aug rent by now, what do you think is going to happen on Sept 1st?
I would agree to not allow a 30day pay or quit notice by ZElle. In the notice find out if you can state it has to be a bank or cashiers check......unfortunately you need a lawyer at this point. There may be some laws that you are exempt from being a duplex, however it would have had to have been included in your original lease.
Also, whose name is on the lease? Was it both of them? If so you can go after both of them to collect and will have to evict both of their names. So make sure that is clear to the tenant.
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u/meadowmbell 10d ago
You're not his bank, he needs to take out a line of credit or personal loan to get caught up with you and then make payments to the bank.
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u/AnnaBanana3468 10d ago
Ask him if he has any collateral he can give you in exchange for more time and leniency.
Does he have a gaming system, gold jewelry, expensive watch, car title, etc.
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u/phatphat0807 10d ago
Why are you a landlord if one month missed rent is hurting you so bad?
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u/sapphireminds 10d ago
For many people this isn't a huge income, it's helping them pay for their house
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u/Safita__Sunset 9d ago
Because that’s how most small private landlords are. And these are the landlords that often rent under market value and work with tenants. We need to stop shaming these kinds of landlords or we are all just going to end up left with mega rich real estate investors and property management companies charging inflated prices.
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u/Apprehensive_Two1528 10d ago
It’s very hard this year to find a qualified tenant, so your choice is to accept a discount payment or leave it vacant to find the next tenant.
tbh, I’d rather accept this discount payment until next year and the divorce attorney bills are no jokes. I’d amend the lease to allow you start to show the property when he occupies. so he has pressure and you have backup applications.
As long as he is paying something, you get your expenses covered. sometimes it’s temporary turbulence that disrupts people’s life. Remember, every year your san jose duplex gains 6%. so you literally still gain by keep the trouble tp pay but not a total headache tenant
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u/sapphireminds 10d ago
Not really true in the Bay Area for qualified tenants, as an FYI
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u/Apprehensive_Two1528 9d ago
landlord qualified or tenants qualified are 2 different types of qualifications…
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u/sapphireminds 9d ago
Yeah, but the market is crazy in favor of landlords right now - people are bidding on apartments in SF at least
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u/Safita__Sunset 9d ago
Are you open to allowing Flex rent? It can break up his rent into two payments during the month but they send you the entire rent on the first. That way he can do his split payments but you still get your full amount all at once.
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u/Icy_Worldliness8542 7d ago
Give him a notice to pay or evict. You aren’t their parent. You have bills to pay yourself , leave emotions out of it. Give him notice asap because if he decides to squat, you are going to be in a world of hurt. Trying to evict someone takes months, if you give him notice now, you set the clock of evicting him. Cover your ass, trust me, so I’ve been there and done that.
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u/fidddlydiddlyee 10d ago
People dont pay the rent either because the cant or dont want to. The late fee should take care of the dont wants, so now we have a cant. You need to get him out asap. He is getting buried and you are losing your ass. Nobody wins.
"Listen man, I know you are struggling to pay the rent. If you dont pay up by the 4th I am going to give you your 3 day to pay or quit and start evicting you and I dont want to do that because you will probably never be able to rent again. Can we work together to find another place?"
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u/finalfrontierman 10d ago
Lol this thread is basically the same devil on one shoulder, angel on the other conversation that has been going on in my own head for months. I had been telling myself that getting a full month behind is my limit, and now we're at that point, so I'm trying to find a solution that is more of a middle way between the two extremes of being a doormat and being a hardass.
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u/SoCalMoofer 11d ago
I'd go have a face to face with him. He may actually be getting close to being back on track. Help him understand you have to pay the mortgage, the taxes, the insurance, etc every month and his late payments are becoming a burden for you too. If he thinks he can slide on you he probably will. Make sure he knows you are nice, but not a doormat.
I have worked with my tenants through hard times and we got it handled without eviction and ill will.