We've had some great discussions recently on Zero Tolerance. I think though that there's a point at which the ones For and Against this policy are talking past each other. In other words, arguing against something that isn't even an issue. Here's what I mean.

In a recent post by Robert Phaedra called "Zero Tolerance" there was a lot of talk from land lord thought ZT meant the day rent is late you file in court and boot the tenant out the door.

I've never seen it that way. Maybe some folks do, but I think that's a misunderstanding of what ZT means.

As I explained in my response to Robert, to me ZT simply mean the LANDLORD sets their policy on rent payment via the lease, explains it clearly at lease signing, and then stick to it.

That's it.

So if Robert wants to say, "Due on the 1st, late on the 5th, evict on the 10th..." Okay. That's ZT, if Robert sticks to it.

If S i d wants to say, "Due on the 1st, late on the 2nd, evict on the 7th..." Okay. That's ZT, if S i d sticks to it.

The key is: set the policy and stick to it. Do not TOLERATE non-compliance with the policy.

But what about the poor little old lady whose husband was in a car wreck and he lost his job and there are medical bills and her next check won't show up for 2 weeks, and, and, and....???

The minute we start making up exceptions to policy on the spot, then we have to ask: what's the point of having a policy? Why do we have a lease if we're not going to follow it?

"I want to DO THE RIGHT THING, and I want to avoid eviction hassle and costs!" laments the kind-hearted yet also business savvy land lord.

Me too! So what is the "right thing?"

A well-crafted policy also contains exceptions. Spelled out. Created at the LANDLORD's discretion.

Here's an example...Tenant calls up. "Robert, I can't pay you the rent right now for reason A, B, C. So I'll pay you on the 15th and add $25 per month until we're caught up on the late fees."

If Robert has a well-crafted ZT policy, there are exceptions in an amendment/exceptions clause. Something like this:

"Exceptions to eviction on the 10th may be granted on a case by case basis for the following reason: tenant suffers an unexpected loss of employment/illness/injury. In this case, eviction may be delayed/canceled if tenant pays at least 50% of the amount due before the 10th and changes to bi-weekly payment schedule."

Robert gives the tenant a solution to the problem, and although it's a bit of a stretch, they find it can work. The payment comes in, the eviction is avoided, Robert's stress level is non-existent because we knew what the plan was up front and now it's working. No one can say this was favoritism or discriminatory. The policy applies to everyone equally.

To me, ZT means the LL sets the policy, sets the exceptions, and enforces them all. The Land lord is in control; the tenant is not.

ZT like this helps in so many ways.

1) It makes life/management simple. No more agonizing over is reason A legit and reason B is not.

2) It treats all of our customers fairly.

3) It protects us legally. The policy applies to everyone, regardless of protected class.

4) It is as flexible as we want/need it to be. The land lord can write in 50 exceptions, if desires, as long as they are written down and followed.

5) It keeps the land lord in control.

When I work for others or advise others I need to follow their lease, remind them that they need to respond quickly to problems.

ZT defined and I agree.

But, it does Not apply to rent collection, only.

(How about the entire Lease Agreement)

My experience with zero tolerance is that if I serve the pay or be evicted the very first time the tenant is late, it tunes up their attitude and they figure out how to pay the rent first.

I will make an exception infrequently for a good tenant who comes to me before rent is due and has a plan and a schedule about paying.

It has to be a one time reason. "My car needs repair,I can pay rent out of my next paycheck", not "I lost my job and no longer have income, so maybe I won't have money for months".

Sid,

One of the problems in enforcing ZT is that most of us (including you) have a business brain that is controlled or influenced by our own emotions.

For example: last year, due to my strict ZT policy, I evicted a husband, wife and 4 small children under the age of 8. I put them on the street,...that bothered me emotionally.

It does not bother me to evict deadbeat adults, they deserve it and it does not bother me one bit. When there are small children involved, it does affect me.

Roy, I hear you!

Two years ago I put a single mom with her < 1 year old kid on the street when it was 35 degrees outside. Per my ZT policy. It was hard. Looking a fellow human in the eyes and saying, "You have to step out side NOW or I must call the sheriff." Gut check.

I'll spare you the details of how she stole 6 weeks of rent from me, punched holes in the walls, and left me a case of bed bugs... Oops. (*grins)

Regarding Roy's emotionally tough situation; Keep this unpleasant experience in mind in the future when screening.

Sisco,

This is the reason I do not rent to friends, family or any relatives for that matter.

I don't write "exceptions" into my lease other than the grace period before late fees start.

I've found that this makes it easier when I do need to make exceptions for tenants . I gives me more negotiating power as I can negotiate down, say from 2 months ELT to 1 month ELT. It makes it seem like I'm doing the tenant a favor rather than what the lease requires me to do.

I have sold some of my units and never was a big LL. So I have more leeway in what I can do. Everything is written in the m2m agreement. When the rent is do, late fees, what each party is responsible for. They vary on the unit and what works for that unit/building. The two families have a different agreement than the singles. Each tenant gets an individual agreement because I see what works over the years and take things out, add things in.

Very touching posts. To me when your dealing with several employees and 100's of units-- there can only be one policy. No matter what it is -- there are to many variables in a HUGE business operation. With employee's they start setting their own policies and we know that won't work.

We find the best policy is a firm date to pay-- if no pay-- we go to court. Tell the Resident when they pay it will be removed. That gives everyone a breather but actually gets the LL into position. Gets the tenant co-operating.

ZT for our office is "court consent" we want payment up until court-- once the court is set--- only a consent will keep the tenant in the property. Following the consent to the LETTER is our ZT.

If you don't do a gut check when putting ANYONE out -- you aren't a person I would call a friend. It's one of the most distasteful parts of our business. I once had a man leave his handicap mother home while he knew we were coming for the set out. We made her comfortable and when the sheriff got hold of it -- I thought the sheriff was going to beat the guy up. How about kids getting off the school bus and their friends watching while their stuff is put out?

Sid,

I coined the phrase ZERO TOLERANCE for just that: ZERO (like Busy said). Wifey and her helper were constantly finding exceptions, next week, next paycheck... so I had to keep barking ZERO! ZERO!

Here's the big deal:

**LLs still don't believe that people will actually pay***

and believe THEY have to take up the slack.

They will pay IF the LL gets it right in his/her mind. They just pay.

It's just like PayDayPlanRent and ELT. Old style LLs are the ones who have trouble believing people will actually PAY.

I coach LLs every day who made a exceptions or wait until the 5th, 10th, 20th, or or or . Now their stuck and court deadlines vary. That's not ZERO. That falls under

WE GET WHAT WE ALLOW.

Allowing more than zero teaches them it's oK to slide. Then they get made when the LL gets tired of sliding and files. Now the LL is instantly a Scumlord. Res do not give a LL credit for being "nice" earlier.

I must testify that ZT WORKS! It's the LLs who have the trouble with it, NOT the residents. They get it. It's just like their job, cell bill, cable bill, heat bill... be on time or lose it.

We MUST talk their language.

We've done this now for approx 3 years and I can show month after month where EVERYONE is paid up. Compared to traditional LLing when we were sending 27 late letters every month.

Most of our rents are due on Friday so we send out 3 day texts on Sat AM. IF we have a late res they usually pay on Sat. We cannot file in court until Monday AM so yes we do give them the weekend. But we started the ZT the day it was late.

If the LL wants to allow more time, first I MUST say, as politely as I can, that LL is being foolish. Waiting and granting exceptions is a recipe for disaster, esp for casual LLs. MY stats are $547,000 lost over 10 years by "working with" people. $54,700 per year is more than most people MAKE in a year.

Story after story here how they granted an exception and were surprised the res had scammed them. Or now the eviction filing is a week or 2 later, already lost half a month.

LLs banging their heads on the wall trying to collect but turning right around and letting the next res slide.

We put the responsibility on the res. I get it, their car broke down. But that's life. Go borrow a weeks worth of rent, pawn some junk, ask your church...there IS money available. Most are just too lazy to hunt it BECAUSE their LL is a softie. It only hurts for a second to send LL a, "I'll pay next week" text and get back an OK.

In today's economy and job market we CANNOT let them fall a DAY behind. They have NO money.

My local Christian charity that helps with housing and utility bills PLEADS with us to NOT let folks fall behind. Poverty snags them down a vortex instantly.

Then like Doogie said we usually find out later the bought a car (like my guy who just bought a Hummer2 instead of his rent. He already had an Escalade, a Mercedes, and a pick up truck)

Probably every LL has a story about being lied to like this AFTER they gave the res an exception.

Just had another on Friday. Autodraft bounced. They were claiming mold, unsafe, you know the drill and what were WE going to do about this horrible house! Turns out the were lying. Already OUT of the house (skipped, closed the account, and turned off the heat.)

If we had a 7 day tolerance policy we would have lost a week before even knowing they were out.

Bible says the man who does not pay his bills is worse that an infidel. Even Jesus paid his bill.

Zero means Zero. If the LL wants a grace period, (I HIGHLY advise against it) then name it 5 days grace policy, or such.

BRAD

Woah! That was too long!

Here's the deal:

My lease is clear: Management does not accept late or partial payments. They initial.

And they pay. Done.

We don't answer the phone so we don't get the sob stories. They just pay. No more chasing rents.

BRAD

Roy of AL evicted a husband, wife and 4 small children under the age of 8. I put them on the street,...that bothered me emotionally. It does not bother me to evict deadbeat adults, they deserve it and it does not bother me one bit. When there are small children involved, it does affect me.

S i d of MO Two years ago I put a single mom with her < 1 year old kid on the street when was 35 degrees outside. Per my ZT policy. It was hard. Looking a fellow human in the eyes and saying, "You have to step out side NOW or I must call the sheriff." Gut check. stole 6 weeks of rent from me, punched holes in the walls, and left me a case of bed bugs... In spite of all that, I still felt bad about it. That's why I have the policy.

Cry Me a River!!!

The above two examples of emotions getting in the way of making a good business decision.

YES 3,000 reasons more or less got in the way of letting a former tenant drag out paying rent and doing damages to the unit with sob stories and lies.. It was about $3,000 dollar worth of back rent, damages and costs to try and recoup the money from this DEADBEAT HOUSE-BEATER. WHO'S fault was it to let this happen? my fault no one else to blame. Trying to be MR NICE GUY did not work out to well on my end. I got ZERO dollars in this eviction and will never recover that money. WHY because deadbeat tenant filed bankruptcy!!! What could $3,000 DOLLARS have done for me.

Help make the mortgage payment!

or

Help make the insurance payment!

or

Help make the real estate taxes payment

or go to dinner!

or put some away for future maintenance!

Does the bank have any emotion in Foreclosure?

Does the credit union or bank have any emotion in repo of a vehicle when not paying the loan?

Does the County Tax Claim Bureau have any emotion in selling property for back taxes.

NO they don't!!!

In the end you can soft soap calling it ZERO TOLERANCE or SOFT SOAP it however you like. After $3,000 went to ZERO dollars I became my tenants worst nightmare and did immediate posting of evictions. ZERO TOLERANCE, ASK NO QUESTIONS, HEAR NO WHINING WHY DeadbeatTenant House Beater can not pay rent this month.

YES Zero Tolerance works. IF you are letting emotions control your decision making and in the process losing money on a monthly basis then it may be time to unload your rentals and put the money in a Money Market Account or Savings Account then you will not need for ZERO TOLERANCE Policy.

Unless you are a 501 charity then you can let people slide of their obligations to pay rent and adhere to lease.

The Best Policy is ZERO TOLERANCE!!! Enforce YOUR lease or let your units run amuck!!!

Roy of AL evicted a husband, wife and 4 small children under the age of 8. I put them on the street,...that bothered me emotionally. It does not bother me to evict deadbeat adults, they deserve it and it does not bother me one bit. When there are small children involved, it does affect me.

S i d of MO Two years ago I put a single mom with her < 1 year old kid on the street when was 35 degrees outside. Per my ZT policy. It was hard. Looking a fellow human in the eyes and saying, "You have to step out side NOW or I must call the sheriff." Gut check. stole 6 weeks of rent from me, punched holes in the walls, and left me a case of bed bugs... In spite of all that, I still felt bad about it. That's why I have the policy.

Cry Me a River!!!

The above two examples of emotions getting in the way of making a good business decision.

YES 3,000 reasons more or less got in the way of letting a former tenant drag out paying rent and doing damages to the unit with sob stories and lies.. It was about $3,000 dollar worth of back rent, damages and costs to try and recoup the money from this DEADBEAT HOUSE-BEATER. WHO'S fault was it to let this happen? my fault no one else to blame. Trying to be MR NICE GUY did not work out to well on my end. I got ZERO dollars in this eviction and will never recover that money. WHY because deadbeat tenant filed bankruptcy!!! What could $3,000 DOLLARS have done for me.

Help make the mortgage payment!

or

Help make the insurance payment!

or

Help make the real estate taxes payment

or go to dinner!

or put some away for future maintenance!

Does the bank have any emotion in Foreclosure?

Does the credit union or bank have any emotion in repo of a vehicle when not paying the loan?

Does the County Tax Claim Bureau have any emotion in selling property for back taxes.

NO they don't!!!

In the end you can soft soap calling it ZERO TOLERANCE or SOFT SOAP it however you like. After $3,000 went to ZERO dollars I became my tenants worst nightmare and did immediate posting of evictions. ZERO TOLERANCE, ASK NO QUESTIONS, HEAR NO WHINING WHY DeadbeatTenant House Beater can not pay rent this month.

YES Zero Tolerance works. IF you are letting emotions control your decision making and in the process losing money on a monthly basis then it may be time to unload your rentals and put the money in a Money Market Account or Savings Account then you will not need for ZERO TOLERANCE Policy.

Unless you are a 501 charity then you can let people slide of their obligations to pay rent and adhere to lease.

The Best Policy is ZERO TOLERANCE!!! Enforce YOUR lease or let your units run amuck!!!

Tom (FL)

Are you some cold heartless bastrd with no soul? There is more to this business than just making money.

Sid and I enforced our own ZT policy and did what we knew we had to do. It just bothered us to put children on the street without a roof over their head.

6x6 Court Consent: Within 3 days of not paying the rent we file the dispossessary (non pay of rent) with the court. There is no back and forth. The court handles late rent. When the tenant answers the court as to why they haven't paid a court date is set. Usually 10 days from date the tenant answered the summons. When you get to court the judge informs those defendants that per GA CODE they must step outside and TRY to come to some agreement (CONSENT) that both party's can live with (AKA a payment plan). Should no consensus be agreed to the judge will hear both sides and judge will write out his plan.

Recently we have tried to get the tenant to agree to the consent "prior" to court date and submit it to he judge. 75% of the time the tenant will sign it. Others just like going to court.

Beauty of a consent is its a time frame for payment. It can go into a future month. Usually when the court decides a case it's only to the date of trial. We include the money owed to date and the next months also. Should the tenant miss a date or payment we can go to the sheriff immediately -- not back to court but to the sheriff and get the writ of possession. Once sheriff is scheduled only one way to stop that-- tenant must pay total amount due-- not a payment plan the TOTAL owed.

Brad...thanks for your insight. I find it valuable, as always.

MO doesn't require a grace period. So you are correct, I get what I allow. I CHOOSE to allow 7 days, the number of completion. At that point, I am COMPLETELY sure I'm done messing with them.

Other states legally require 10 day grace periods. So, I'm still 3 days more hard-nosed than they are. But in my wonderful state where we still believe in freedom of the LL/Tenant to agree to our own rules this policy is by my choice, not dictated by some heavy-handed legislator's force.

Do I get what I allow? Sometimes, yes. I am OK with that. Most of my tenants (90%) pay on time or early. I only have a handful right now that occasionally miss the mark by a day or two, and only one right now who continues to struggle. Regardless, I don't think I've ever posted here moaning about my residents sometimes paying late. I have posted musing on it...wondering why they choose to give me so much extra money...but I don't think I was whining. *shrug. Maybe I forget. If I whined, I apologize.

Anyway, point being exactly what you said here, "If the LL wants a grace period, (I HIGHLY advise against it) then name it 5 days grace policy, or such."

I name it 7 days in my mind not in my lease, and with that, I am content. Maybe someday I will go to zero days like you. It took you half a million $ to make this decision, so perhaps you can understand why others are still "struggling" a little (*grins). Remember it took me about 2 years to come around to the Pay Day plan, and now I love it. Keep preachin' brother! Sometimes the message takes a little time to percolate down thru the layers....

Good discussion Sid.

I agree with ZT in the way you phrased it. I do have late fees, but I always collect/expect them and tell tenants in the lease that management reserves the right to evict after 2 late payments in a calendar year. And how late they are is also discussed...60 days is not "late" in our book. Anything more than 5 days is TOO late and we will file at soonest possible chance after that.

One comment I'd like to make...just the way I see things. When some of you say "I put a lady out on the street in winter"...I think you're looking at it wrong. These people are putting themselves out on the street by making poor life choices or not having the creative problem-solving they need to pay their rent. Shelter is the 2nd most basic need after food...so it should be near the very top of their list. Emergencies happen to everyone, so PLAN for them....just listen to Dave Ramsey.

Like Sid, I choose to allow 7 days before I post a P/Q notice on the 8th day. Here P/Q notices are 7 days and not 3 days as in other states. So, I technically can't file papers until the 14th day. I have considered making changes to this by allowing only 3 days grace period instead of 7 but would this make difference in the end?

Great thing about this landlording gig is, there is room for all of us. We DO have to operate under the confines of our state laws, and we DO need to consider whether our situations make us treat everyone exactly the same, no matter what. A multi family, yep, better keep it the same. Employees responsible for collections? Yep, may be better to have very tight standards.

My work background is in special education, where each child has an IEP (Individualized Educational Plan.) The IEP is followed closely, but no two IEPs are exactly the same. I have seen where a small change can yield great success. That might be comparable to the Payday Plan in landlording.

In education, all of the options are NOT spelled out with every child’s family at the start of the school year. Rather, the teacher sets the expectations for the entire class the same, and when a child shows difficulty in achieving success, THEN the other options are explored.

Not a perfect analogy to landlording, but , individualized plans are so much a part of my make-up, that I have a hard time accepting ‘one size fits most’. BUT, that is also why I choose to not own any mult-families, do not want houses within sight of each other, and am seriously questioning whether renting to relatives or friends of tenants would be a good idea. This last one (renting to a sibling/friend of a tenant,) is giving me some pause. I AM finding that even though I’ve attempted to isolate my single families, there are still connections tenants can make, where they can have conversations. So, having A Plan And Stick To It has now become my operating system. I just don’t reveal all at lease signing, but, my plan is written down and dated.

I know it grates on the nerves of some that I allow tenants to text asking for a new pay date every month. In my situation, there are some reasons for this. Probably the biggest ones are: some judges in our courts system will ‘ grant an eviction, but allow the tenant to stay’ if the tenant has the rent by the court hearing. What? Eviction means eviction, just like zero means zero. But, some judges have chosen to redefine some words. BTW, this behavior by some judges is heresay, I’ve not experienced it first hand. But, I do have a couple tenants with one eviction on their record from some time ago, from the landlord they were still at.a year or more later.

Part of my plan is: Every time the tenant texts asking for a due date change, another late fee is triggered. However, I AM seeing one couple starting to make too much of a habit of this. So, yes, not a perfect system. I am planning on increasing the late fees for all tenants to either curb asking to pay late, or fatten my coffers if they do. And, for the one house where they are making a habit of paying a late fee most months? Hmmm... if they can afford a late fee most months, maybe rent at that house is under market? I’ll need to evaluate.

The judges’ behavior regarding evictions is why I have chosen to only do MTM. The scuttle in the local landlord groups is there is wide variety in how our judges interpret landlord-tenant laws in my county, so, MTM allows me to terminate with proper notice, should it come to that.

@Hoosier, amen on the attitude re: who is responsible. I'm not saying I feel bad in the sense that it's somehow my fault. It's ALWAYS the tenant's fault. They chose to pay someone else vs. me. They chose to dig their heels in vs. move-out, which is what our lease says they agree to do if they cannot pay. I simply feel badly that it came to this. It is what it is.

@Roy...I would definitely consider posting POQ earlier. Sounds like you already have the 7 days built in via that lengthy notice. I'd post the day after. I know you don't like filing due to the cost, but what's the cost of a week's rent? Maybe experiment with it for 3 months and see if you get a better response.

Great lively discussion!

For the record, SID and I are buddies! My ranting post was not an attack on my friend but rather a challenge to all readers. I tend to get wordy late at night!

As I write replies here I am constantly considering the newbies and lurkers so I write so they understand.

Change: It takes time. Time to come around and realize the need to change.

My theory is LLs don't get serious about making changes until they REALIZE they lost $3000 on one resident. Some never add up the loss so they don't know their true loss and keep doing the same old thing. Some swallow the losses until they reach that $3000 threshold. THAT's when I get a panic call "What do I do!?!" or my favorite "I guess I need to join the LL association."

Like Tom said a few baddies ruined it for everyone else.

Quick case study: Sometimes other stuff adds on to the eviction process. Res owed $400 (paying every other Friday). Texted, filed on Monday. Judge was on vacation so rather than getting a court date 14 days out (normal here) the date was 30 days out. So that's 2 more $400 payments not being made.

The res was ill so the court put it out another 14 days. That's ANOTHER $400 payment.

The judge gave the his standard 14 days to move out so add another $400.

The res did not cooperate. In our system we have to have ANOTHER hearing to get a sheriff set-out. Another 4 days.

The rent is now up to $2000. $400 escalated to $2000.

They left a mess, another $1000 in clean up and repaint.

My $400 issue easily became a $3000. Nip it in the bud.

Another: Jim Rohn is one of my business teaching heroes. He used the phrase "Take it times 1,000" when considering any business action. If you have a handful of rentals and like being hands on, in charge, King of Your Empire, in control kinda guy or gal, do what ever you like and more power to ya! There are some LLs who actually ENJOY drama because it gives them a reason to be involved.

BUT to scale up and grow a profitable business examine your procedures by taking it times 1,000. Do you REALLY want to be chasing 1,000 people for rent? 1,000 individual plans? 1,000 exceptions? 1,000 rents late each month?

We don't have 1,000 units but this simple challenge helps us solve problems quickly and clearly.

Homeless: we don't put anyone on the street. The JUDGE gives them 14 more days to get out, after the 14 day notice to appear in court, after our 3 day text. No one is surprised.

BUT...

I go back to my first post - send the text and people PAY! This AVOIDS eviction!

Love you all!

BRAD

Roy not filing for eviction is a bank and BACK breaker so stop with how much it cost. BILL the tenant -- include it in what they owe for the month or through collections and add the extra 25%.

"take it x 1,000"

Excellent advice!

Fortunately, I have not had many problems with late payers. Again, I only have one right now who struggles consistently, and he always gets it in (just barely sometimes) within the 7 days before I file. He gets a "friday" text just like Brad give.

"Ding, ding...hey, rent?"

1-6 days later, rent + late fees arrive. It's just how he does business.

I've only had two evictions this year: one the gal paid up before court and saved her tenancy. The other one I filed on Day 7 but the guy had been gone already for 2 weeks according to the neighbors. ZT in the case would've still been a week too late to catch him. When I found he was gone, I turned it over.

This year I could have multiplied my # of units 1,000x and not had too many worries. But yes, in 2017 it would've been nuts to be custom-crafting a 'solution' for everyone. I had 6 evictions filings that year...bleh. Luckily, they all went according to "the plan."

Here's 'the plan':

Day 1 late - text "Rent?"

Day 7 late - if no contact, file papers.

Between 1-7 if they contact me, we go to the PayDay plan.

So, while I have exceptions, they are pretty cut and dry. Easy to follow and takes minimal time.