Clients of Preferental can rest at ease knowing that they will receive their rent each month, although their tenants might default on the payments. This may involve sending a Letter of Demand to the tenant, which outlines the amount of rent owed and the timeframe in which it must be paid. We guarantee the landlord his monthly rent, but what happens behind the scenes with tenants who don’t pay their rent?
Preferental usually sends out the rental invoice on the 25th and gives the tenant time to pay his rent until the last day of each month (in order to reflect in our bank account on the 1st of the following month). If we haven’t received the rent by the second of the month, we trigger a Letter of Demand to be sent out to the tenant.
What is it?
In rentals, it is a letter that is sent to a tenant who owns the landlord or agency a certain rental amount. The Letter of Demand calls the tenant to action by paying the outstanding rent and any associated amounts due. If the tenant fails to do so, further action will be taken. A Letter of Demand reminds the tenant of the outstanding amount they owe and gives them a specific deadline for payment, along with warning them of legal consequences if they fail to pay. It is an important tool for landlords to ensure they receive their rent and for tenants to stay on top of their rental payments.
Why do we need to send it out?
As the definition describes, the Letter of Demand reminds the tenant on the outstanding amount that he owes the agency or landlord. It also gives the tenant a specific deadline for the payment. Furthermore, it also warns the tenant of the legal consequences should he fail to make the payment. Sending out a Letter of Demand is an important step in the rental process because it helps ensure that landlords receive their rent and tenants understand the consequences of not paying on time. It can also provide a clear record of communication between the landlord or agency and the tenant, which may be useful in the event of legal action. Overall, the Letter of Demand is a crucial tool for landlords to manage their rental properties and ensure timely payments from tenants.
Who should use one?
A letter of demand should be used by landlords or rental agencies to remind tenants of the outstanding amount they owe and to request payment by a specific deadline. If the tenant fails to make the payment, further legal action may be taken. Preferental takes that responsibility off our landlords’ shoulders by sending out the Letter of Demand on their behalf. This service is included in the Preferental Promise.
What does it say?
The Letter of Demand confirms the following:
- The letter specifies the exact outstanding amount that needs to be settled. It provides transparency, ensuring you’re aware of the precise figure owed.
- A due date for payment is included to emphasize the importance of timely settlement. Meeting this deadline helps avoid any further complications or penalties.
- It’s good practice to include late payment penalty fees should the rental not reflect after the 1st as this will encourage promptness in rental payments.
- To facilitate swift transactions, the letter includes clear instructions regarding the banking details where you should transfer outstanding amounts.
In conclusion, a Letter of Demand is an important tool for landlords and rental agencies to ensure timely payments from tenants and to remind them of the legal consequences of not paying their rent. It can also provide a clear record of communication between the parties and may be useful in the event of legal action. Preferental offers this service as part of their promise to their clients, taking the responsibility off the landlord’s shoulders. By sending out a Letter of Demand, Preferental helps ensure that their clients receive their rent each month, even if their tenants default on the payments. With Preferental’s assistance, landlords can rest assured that their rental properties are being effectively managed. Enquire today!
Source: Agreements Online (2019)
