There are less than three weeks left in 2020. This year has been particularly tough for Florida property owners who are navigating the inability of tenants to pay rent.
On one hand, there is empathy for the difficulty your tenant is facing if they don’t have the income to pay the rent, but on the other, your business and real estate investments are often how you pay your bills. That’s why it’s very important you prep your business and property investments for 2021, including amending your contracts and leases to address the unusual circumstances revealed in 2020 by Covid-19.
What does that mean?
Prepare Your Contracts and Leases for Pandemic Provisions
You may need to amend your contracts and leads to include pandemic provisions. Covid-19 has exposed how a pandemic can disrupt the economy and your business.
While most people are understanding when a responsible tenant falls on hard times, you also don’t want people who are willing and able to pay to abuse pandemic protections.
According to The National Law Review, there are several things property owners can do to help tenants who need the assistance, while also protecting themselves. One way they advise doing this is by modifying your existing leases in exchange for deferred rent. This can include extending the lease terms, adjusting security deposits, adding corporate or personal guarantees, etc. While covid-19 restrictions prevent property owners from evicting tenants, property owners can continue to enforce penalty fees as listed in lease agreements for tenants who are able, but unwilling to pay.
You may also need to include a provision in which your tenant must show proof of loss of income (i.e. a layoff letter or other document that shows they no longer have income).
We’re not suggesting that you don’t have compassion for those who really need it. We are however sharing the importance of protecting yourself against people who may scam the system, which will ultimately hurt your business and livelihood in the long-run.
Implement Flexible Rent Schedules for Your Tenants
You can also consider implementing flexible payment schedules, according to Forbes. Collecting some rent is better than collecting none and it shows good faith on the part of you and your tenant.
We also encourage you to search for financial assistance for your business as well. Perhaps your lender is willing to modify the agreements you have with them.
Remember, evictions are expensive for both parties, so you want to prepare yourself and your tenants for a positive renting experience even in the face of external chaos (such as a pandemic).
Just like we didn’t expect the coronavirus pandemic, we don’t know what 2021 will bring. But you can do your best to take what this year has taught you and prepare your business and investment properties for next year.
Remember, nothing is in vain if you learn from it!
Are you a landlord who needs help legally prepping your business for 2021? You may need to consult with an attorney who specializes in landlord/tenant law in Florida. Give our offices a call today at 786-504- 5760.
The information in this blog post has been provided for informational purposes only and may not reflect the current laws in your jurisdiction. No information contained in this post should be construed as legal advice from The Onyx Group, or the author, nor is it intended to be a substitute for legal counsel on any subject matter.
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