As a Phoenix landlord, you’ve likely faced situations where tenants ask to pay only a part of their rent for the month. We know it's never easy to decide how to answer this question.
Should you accept the partial payment to maintain peace or stick to the lease agreement to ensure consistent cash flow?
Partial rent payments are becoming more common as tenants face financial challenges, especially in a fast-growing city like Phoenix. While offering flexibility might seem compassionate, it can also open the door to future late payments and impact your overall rental income. You’re left wondering: is accepting a partial payment worth the risk?
What if there was a way to support your tenants in times of need while still protecting your finances?
Stick with us as we explore whether you should allow partial rent payments and how to do it right so both you and your tenants can thrive.
What Does State Law Says?
In Arizona, landlords aren’t required to accept partial rent payments. However, according to Arizona law (A.R.S. &33-1371), if you accept less than the full rent, you lose the right to evict the tenant, even if they don’t pay the remaining balance.
This rule also applies if you allow tenants to pay in two parts—like half on the 1st of the month and half on the 15th. If you accept the first half, and the tenant doesn’t pay the second half, you cannot evict them.
Be careful, though, about holding onto a partial payment, hoping the tenant will pay the rest later. Even if you don’t deposit the money, the court can say that you accepted it, which means you can’t evict the tenant anymore.
So, Should You Handle Partial Rent Payments?
Alright, let’s say you’ve decided to accept a partial rent payment. How do you manage it without setting yourself up for future issues? Here are a few steps you should follow to avoid legal problems.
1. Create a Written Agreement
If you’re accepting less than the full rent, get it in writing. Spell out the terms: how much the tenant owes, what the remaining balance is, when they’ll pay it, and if there are any applicable late fees.
2. Offer a Payment Plan
Work out a plan to help your tenant pay off the outstanding balance in a reasonable timeframe. This could prevent late rent payments from spiralling out of control while also helping your tenant stay on track.
3. Consider Online Rent Payments
Setting up an online payment system can make managing partial payments easier. Plus, it’s easy for you to track precisely how much has been paid and what’s still owed.
Pros and Cons of Accepting Partial Rent Payment
Let’s be real. As a landlord, tenants paying rent is your bread and butter. You rely on monthly rent payments to cover your property’s mortgage, maintenance, and upkeep. So, when a tenant asks to pay less than the full amount, you’re left weighing the pros and cons.
A. Pros
It’s a Lifeline for Tenants
Allowing partial payments can offer your tenants temporary relief when they’re in a tough spot. You know that life happens, and sometimes people need a little grace period to get back on their feet.
It Preserves the Landlord-Tenant Relationship
Being flexible with rent payments can foster a positive relationship between you and your tenant. Showing understanding and patience could encourage them to stay for a long time in your rental home, reducing the stress of finding new tenants.
Avoids Eviction Drama
Going through an eviction is a hassle—emotionally, legally, and financially. Accepting partial payments might help you avoid that whole mess, especially if your tenant needs a short-term solution.
B. Cons
Inconsistent Cash Flow
Your rental income pays the bills, but accepting partial rent payments disrupts that flow. If your tenant continues to pay less each month, it could become a strain on your finances, too.
Accumulating Debt for the Tenant
Partial payments might ease the tenant’s burden for now, but it could lead to a bigger problem down the road. As the outstanding balance builds up, it might become harder for them to catch up, putting both you and the tenant in a challenging position.
Complicating Evictions
Accepting partial payments may unintentionally reset the clock on the eviction process. If you end up needing to evict, local laws might view your acceptance of partial rent as you agreeing to new terms, which can delay things.
Should You Accept Partial Rent Payments?
At the end of the day, only you can decide whether you accept only a portion of rent payments or not. Here are a few factors you might want to consider before making this decision:
- Tenant’s Payment History: Do they generally pay rent on time, or is this a one-off situation?
- Financial Stability: Is this a short-term issue for the tenant, or are they likely to keep struggling?
- Your Financial Situation: Can you afford to be flexible, or do you need full payments to keep your property afloat?
Sometimes, working with a tenant and accepting a partial payment is the right move. But in other cases, holding firm on full rent payments may be the better call.
How Real Property Management Phoenix Valley Can Help
At Real Property Management Phoenix Valley, we understand that dealing with rent payments (especially when tenant pays partial ones) is no walk in the park. We’re here to take that burden off your shoulders.
Whether you need help setting up a payment plan or managing your rental income, we’ve got you covered!
Our team can assist with everything from rent collection to handling late payments, ensuring you maintain a consistent cash flow. Plus, we’re well-versed in local regulations, ensuring you remain compliant with the law, whether you accept partial payments or not.
Visit our Rent Collection page to learn more or schedule a FREE Consultation with us!
Balance Flexibility and Protect Your Investment With A Trusted Property Manager!
Partial rent payments are a common challenge for Phoenix landlords, and figuring out the best approach can feel like walking on a tightrope.
While offering flexibility to tenants during difficult times is important, it’s equally essential to safeguard your rental income and property. That’s where Real Property Management Phoenix Valley comes in.
Our team of experts is ready to help you navigate these tricky situations with ease. We've got you covered, whether it’s setting up payment plans, managing rent collection, or ensuring legal compliance.
Ready to find the right balance between flexibility and financial security? Visit our website or give us a call to learn more about how we can assist you!
