As more and more tenants fall behind in rent, the impacts of COVID are being felt far and wide!
If you are a Residential Landlord or a Property Manager then this article will bring some joy to your world! Reduce the number of mediations you need to attend.
Often a tenant falls behind in rent not through choice but for a particular reason or a change in personal circumstances. Once this occurs, trying to follow up and collect payment isn’t an easy process and can often result in a long and winding pathway towards negotiation and/or mediation. Tenancy Mediation can provide a positive outcome, but the time it takes to get there can be less than desirable. On the other hand, it can be a complete waste of time if the tenant fails to show up and goes underground. Whilst we can’t promise to bring the underground tenants to the table, we can provide a solution that assists you with fast tracking agreements and payments from the tenants that would normally pay because they want to protect their living arrangement. Drip provides the opportunity to engage in negotiations early and set up payment installment agreements much faster than you currently can. For example, you would currently provide a Notice to Remedy period and that is to allow the tenant time to come up with a solution. If this fails, then you can apply to the Tenancy Tribunal for assistance in mediation or a court hearing.
How can I reduce the time frame? With Drip Payment Arrangement plans, you can send through an offer to the tenant for them to view. If they accept, it’s a legally binding agreement and the problem is sorted, often within 3-5 days. An added benefit to using Drip is the ability for you to set up parameters for negotiation. This function allows the tenant to negotiate online and in real time to settle the issue and agree to an installment payment plan that best suits them, without feeling belittled or embarrassed.
How much will it cost? Whilst our commercial customers can opt for the customer to pay the service fee, under the Residential Tenancies Act 1986, you are unable to charge penalties or late payment fees so you will need to pay the service fee. But the great news is that this is only 2.95% of all monies paid. And if you compare this to the time it takes to sort out the problem, alongside the costs attributed to preparing and attending the proceedings……..it really is a no brainer. You have nothing to lose and the opportunity to make your workload easier and lighter. If it fails – you still have a higher chance of winning!
Worst case scenario the tenant goes underground, refuses to engage or agrees and then defaults on payments, you are still in a strong position. At that point, you will have strong documentation to showcase evidence of empathy and a willingness to assist the tenant through the process. In addition, it will expose the tenant and reiterate their refusal to engage or failure to meet their payment installments as set out in the agreed Payment arrangement terms. Above all, offering Drip provides you with an option that is easy, and empathetic. As long as you pay the fees, you remain compliant with the Residential Tenancy Act and you have the ability to collect overdue rent arrears much faster.