M.S. Debt Recovery and Solutions Inc. - Your, Out of Office Account Receivables Team!

Your tenant has stopped paying the rent. Now what?


Your tenant has stopped paying the rent. Now what?

February 5, 2014

Every landlord will at some point in their lifetime experience a clash with a tenant that suddenly feels rental payments are no longer a priority to make anymore. Well that’s great for the tenant isn’t it? Too bad landlords don’t have the same advantages. I mean, wouldn’t it be nice to take a break from paying the mortgage  for a while, just until the tenant is back on track with their rental payments?

Unfortunately, reality is something else.

The reality is, when a tenant decides to leave a landlord in debt, all the landlord sees is a big black wall in front of him/her with large capital letters saying:
“Find me if you can, loser”

No one wants to be a loser, but sadly, landlords seem to lose their money and their fight in collections everyday because of simple steps they decide to avoid.

Now, as a debt recovery agency, I can quit this topic and tell you to email or fax me the account listing form and I’ll make this irresponsible tenant pay you for your losses. Which is why you’re here anyway, right?

We can take that route, no worries, but first let’s talk about how you can reduce the chances of having to deal with a dead beat tenant altogether as well as increase the chances of collecting your money if you had to take the route of collections.

Believe me, if tomorrow another one of your tenants decides to pull a fast one on you, you will be thanking yourself for obtaining the right information and taking the right steps. And of course, thanking me because I been such a good help to you.

Lets start from the top.
Have you received references from this tenant before considering him or her? That may be a good idea. If the future tenant hesitates doing something so simple like giving you a reference, you should notice a red flag warning right there and then.
Think of it this way, if you’re a trustworthy individual with friends and family that have faith in you, especially when it comes to money, then you should happily be providing a reference – without the excuses.


Obtain all income related information from this potential tenant. Where do they work? What position do they hold? Ask them for a letter from their employer so you could keep it on file.

Third, show them your serious and make the following statement.
“I may have to pull a credit bureau report if that’s alright? Please provide me with your full legal name and your valid SIN or birth date so I could proceed with your permission of course.”
Now this credit bureau check does cost some money and I’m not saying to actually do it. But as a collection agency, I can tell you, if there is even a little drop of “future dead beat” in this potential tenant, then he/she will voluntarily walk away from you. And that, my friend, will help you to eliminate the bad ones from the good.

Fourth: Make sure you make it clear that you will be taking only post dated checks from them. This allows you to keep important banking information on file about your tenant such as the bank name, branch, account number etc.

Lastly: what’s stopping you from picking up a residential tenancy agreement and actually making use of it? If you live in BC, here is the adobe format link. Print it!

Now let’s pretend your “dream tenant” passed all the references and the big credit bureau test and you now have this great guy in your apartment for almost a year now.
Suddenly, his business goes bankrupt and he decides you aren’t a priority anymore to make payments to. But he isn’t being honest with you and is instead feeding you with empty promises and excuses so he has yet another month to stay put. After three long months of tension between you two, the sucker flees overnight!

Now… You’re upset, angry and devastated. You have the bank calling you for their payments but you weren’t expecting this to happen. You finally remember the file you created before renting the place out to the tenant and you review the information you acquired almost 12 months ago.
Now let’s take a look at what we’ve got here. You have a valid birth date from when you told him you would be pulling a credit bureau report. Second, you have information on his part time job he was employed at while operating his business – the reference letter shows the company’s contact information. And third, you have a copy of this dead beat tenants banking information because of the post dated checks you had obtained from him.

So you put together all this information and decide its time to throw this guy in collections. And so you do. Well this sucker doesn’t care any more than he did when he had left you with a stack of mortgage and utility bills to face. So merely collecting over the telephone just doesn’t cut it with this one.

So your knocking on the doors of Small claims or Supreme Court with the help of your good friend – your favourite collection agency. Since you had prepared a tenancy agreement it speeds up the court process and before you know it, you’ve obtained judgment against him. Because you have a part time job on file, we garnishee his wages and start retrieving monthly payments from him right away! On top of that, you have a valid birth date for him and we pull a credit bureau report (for real this time) and find out he is fully employed elsewhere as well after his business drowned. So we decide to garnish wages on his full time income now. Furthermore, the banking information from the check serves a beneficial purpose if there are funds in the account to begin with. A garnishee order can be served so the tenants bank account could be accessed for the over due rental payments. The procedures continue, until of course you are paid in full.

Now, I know the collections and courthouse procedures can be very stressful and time consuming. But, by acquiring the right information before letting the tenant set foot into your home, you give yourself a head start in dealing with any issues involving the rental payments.

I mean, nothing is guaranteed in life is it? So why put a guarantee stamp on a stranger that is obviously trying to impress you during the screening process.

I can’t say by using the above steps you will NEVER experience another bad tenant again. That would just be giving you empty promises.
I can however guarantee that you will be greatly reducing the probability of renting your place out to a complete dead beat tenant, as well as strengthening your case with higher pay-out potential if the tenant is ever taken into collections.

Have faith in this system. It really works!
But don’t take my word for it; I’m just a collection agency.

Tipping my hat,

M.S. Debt Recovery & Solutions Inc.

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