The majority of tenants in Canada did make full or partial payments for the month of April.
According to a news report, 85% of tenants made some form of payment to their landlords, with 70-75% paying in full.
That’s positive news for the rental industry as a whole, especially given the uncertainty four weeks ago sparked by sudden and widespread unemployment, and the rhetoric of tenant groups advocating for rent strikes during this crisis. It could have been a lot worse.
This result appears to indicate that many landlords were successful in working out payment plans with tenants. It also seems that tenants got the message: eviction moratoriums will not last forever.
Now, let’s hope that May brings even better results.
Here are some tips that may improve your odds of receiving ongoing rent payments during the COVID-19 crisis:
If you have not yet worked out a payment plan with tenants, continue to reach out. Suggestions for a work-around include:
Prorating missed rent over six months or over the term of the tenancy agreement;
Applying rent deposits like last month’s rent to the current month;
Asking tenants to pay whatever they can pay; or
Helping tenants research what government assistance may be available to them. For instance, British Columbia is offering rent supplements. Other plans, like unemployment or childcare assistance, may give tenants enough leverage to pay rent.
The best arguments landlords can use to negotiate include:
The tenancy agreement is still binding despite the emergency, and rent is still due. Some tenants have received bad information. Rent strikes and other acts of defiance violate the tenancy agreement. Check out the website of the tenancy board in the province to see if there is a statement encouraging tenants to pay rent. Refer the tenant to the website. For example, the Manitoba Residential Tenancies Branch provides notice to tenants that states, “A tenant is still obligated to pay their rent in full and on time.”
Eviction moratoriums are due to expire soon, and the tenant will be subject to eviction.
An eviction or nonpayment will hurt rental history. A bad rental history will make it much harder to find another place to live, and the tenant will be competing for vacancies with many other displaced tenants who didn’t pay rent.
A landlord needs to pay their bills in order to keep the rental property in service. If the tenant doesn’t pay, the rental may no longer be available.
The tenant may be entitled to government assistance, like unemployment insurance or tax credits.
Government assistance is there so tenants can pay their rent. The eviction tribunal will not be sympathetic if the tenant simply decides to withhold payments; and
Rent is the highest priority. Tenants should look at other forbearance options — phone company, credit cards, utilities — so they can stay in their homes.
For landlords who have worked out a payment plan, it’s a good idea to invoice the tenant with the correct amount due for May. Separate the current rent from the agreed-upon installment for missed rent so tenants can keep track.
As always, make it easy for tenants to pay rent. Don’t demand special payment options like cash, money orders, or cashier cheques that force tenants to make a trip to the bank or grocery store. Don’t require tenants to pay in person.
This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).
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Disclaimer: The information provided in this post is not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.
