You've been presented with the opportunity to purchase a new investment property in Nashville, TN, and the news sounds like music to your ears. Now couldn't be a better time to capitalize on that opportunity in Music City.
Research shows that Nashville's real estate market in November 2023 was ranked ninth nationwide for in-construction rental homes. This is due to the area's rapid population growth. Nashville is popular for its bustling music scene and vibrant arts community.
What happens if your tenant experiences financial hardship after renting your property, though? You may need to take steps to ensure rent collection. Let's explore tips and best practices for rent collection in this situation.
Be Flexible
An effective way to collect payments from renters experiencing financial hardships is to provide flexible payment arrangement options. These options should fit their circumstances and needs.
Allow a struggling renter to make installment payments to fulfill their lease obligations. You may also temporarily reduce their rent or defer a portion of it.
Consider accepting alternative methods of payment to increase your chances of collecting rent. Other methods may include electronic bank transfers and credit cards versus cash only.
Draft a written contract specifying the conditions and terms of any rental payment arrangement you make with a tenant. The agreement should specify the rental payment amount, frequency, duration, and penalties for non-compliance. This may help you avoid legal disputes and safeguard your rights.
Provide Assistance
Offer financially struggling tenants assistance and incentives to encourage them to catch up on late payments or pay promptly. Incentives could include a discount for paying rent in advance or in full.
Landlords with tenants facing financial hardships may also want to help their renters access financial programs or resources to help them cover their rent payments. These include charities, bank loans or government emergency rental support programs. Providing this support is an excellent way to build loyalty and trust with your renters while ensuring you receive the rent payments you're entitled to.
Communicate Early
Another critical step in navigating rent collection during a tenant's financial hardship is to speak with the tenant immediately. Don't wait until their rent is overdue to connect with them.
Ask your struggling tenant about their financial situation and whether they can pay their upcoming rent. Listen to the tenant's concerns to demonstrate that their financial and mental well-being matters to you. Solid tenant communication may help you accomplish a mutually satisfactory solution and avoid misunderstandings and conflicts.
How We Can Help With Rent Collection
Tips for helping with rent collection include offering flexible payment arrangement options and offering discounts for on-time payments. Connect your tenants to government programs or charities that can help them cover their rent, and communicate with them about their financial situation early on to avoid misunderstandings.
At PMI Music City, we offer top-tier rental property management services in Nashville. We can help you collect rent, screen tenants, market your property, and even handle tenant evictions. Contact us to learn more about our services, and schedule a consult today!
