Act early
Most rent arrears are easier to resolve when they are small. Good property management means rent is monitored closely and a missed payment is followed up promptly, politely and in writing.
Often there is a simple explanation, such as a change in pay date or a bank error. A quick conversation can put things right before the arrears grow.
- Ask your team how rent is monitored and how quickly late rent is followed up.
- Make sure every contact with the tenant is recorded.
- Ask to be told when arrears reach a level you set.
Payment plans
If a tenant is having genuine difficulty, a written payment plan can be a better outcome for everyone than ending the tenancy. A plan should set out the amount owed, the extra amount to be paid with each rent payment and the dates.
Your team will monitor the plan and let you know if payments are missed.
- Agree any payment plan in writing.
- Make sure the plan is realistic for the tenant.
- Monitor each payment against the plan.
Formal notices and NCAT
If arrears are not resolved, NSW rules set out when and how a termination notice for non-payment can be given, and the tenant can avoid termination by paying what is owed or agreeing to a plan. If the matter is not resolved, the NSW Civil and Administrative Tribunal (NCAT) can make orders.
These steps have strict requirements. Your team will make sure notices are in the correct form and given at the right time, and will discuss each step with you before it is taken.
- Do not issue a notice without checking the requirements.
- Keep the rent ledger up to date and accurate.
- Discuss each formal step with your team before it is taken.
Preventing arrears
Careful tenant selection, a rent that suits the market and good communication through the tenancy all reduce the risk of arrears. Landlord insurance with loss of rent cover can also help; check what your policy covers.
A tenant who feels they can talk to the team early is more likely to raise a problem before it becomes serious.
- Check rental history and ability to pay before approving applicants.
- Review your insurance for loss of rent cover.
- Encourage tenants to contact the team early if they expect difficulty.
Let’s talk about your property.
Discuss your plans and the next steps with our team.
