In the last chapter, we went over how to handle late rent payments. Sometimes, tenants will pay on time, but it’s only a partial payment. In this case, is rent still considered late? We’ll answer common questions on partial payments in this chapter and provide best practices for how to handle them.
What Are Partial Rent Payments?
Partial rent payments are when your tenant pays you only a portion of the monthly rent price. For example, if your monthly rent price is $2,000 and your tenant only pays you $1,500, then he or she gave you a partial payment.
Are Partial Rent Payments Considered Late Payments?
Yes, partial payments should be considered late rent because you have not received the full amount on time.
Should You Accept Partial Rent Payments?
It’s okay to accept partial payments as long as you handle it correctly. You can sign an agreement with your tenant called an “Agreement for Delayed or Partial Rent Payments.” That way, your tenant understands that you expect the remainder of the payment by a certain date.
If you have already filed for an eviction, then you should not accept partial payments. Some states will make you restart the eviction process if you accept a partial payment after filing at court.
There are no laws stating how to handle partial payments (unless you’re in the process of an eviction), so it’s up to you to decide whether you’ll accept partial payments or not. We’re here to make your decision easier.
Are There Drawbacks to Accepting a Partial Rent Payment?
By accepting a portion of the rent, you may make the tenant less concerned about owing you money. The tenant will now owe you less money than the full amount, which may feel less concerning to your tenant. Plus, by accepting a partial payment, you may be communicating to your tenant that the behavior of not paying the full amount is okay.
To combat this drawback, you should make it clear when you accept the payment that you require the rest of the money be paid by a certain date. Communicating that you expect the rest of the money is key, so your tenant still understands he or she owes you money.
Keep in mind, as we said above, that you should not accept a partial payment if you have already filed for an eviction. In that case, the drawback is having to re-start the eviction process.
How to Handle a Partial Rent Payment
The first step is deciding whether or not you want to accept the partial rent payment.
If you decide to accept a partial payment:
- Find out the reason for the partial payment. Is the tenant having financial troubles?
- Let your tenant know you will accept the payment, but you expect the full payment by a certain date. You should add your late rent fee to the amount-owed since the full amount of rent is late.
- Document that the tenant did not pay you the full rent amount. This will help you in case the tenant never pays you the rest of the money.
- For added security, you can sign an “Agreement for Delayed or Partial Rent Payments.”
If you decide to not accept a partial payment:
- If you receive a check with a partial payment and you do not want to accept it, then do not deposit the check in your bank account.
- Communicate with your tenant that you are not accepting the partial payment and you expect the full amount to be paid by a set date.
- Discuss with your tenant the cause of the partial payment. If the tenant is waiting for a paycheck before being able to pay the full amount, then you could consider changing the rent due date to accommodate his or her financial situation.
Keep in mind if the tenant doesn’t pay you the full amount by an agreed upon date, then you should follow the steps in the chapter: How to Handle Late Rent Payments.
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Next Steps
From time to time, you may receive a partial payment from a tenant. It’s important to know what to do if this happens so you can set yourself up for success. After all, you don’t want to end up re-starting an eviction process or giving your tenant the impression that partial payments are okay.
Up next, we’re going to discuss raising rent and rent control. Keep reading below to learn more.
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Originally published at Rentalutions.
