How should I raise the rent on a tenant who might not be able to pay?

How should I raise the rent ?

Send your tenant a letter via certified mail informing them of the increase in the rental rate that will take effect at the end of the
current lease. No explanation required. Make sure you include a requirement to respond by a specific date and remind them that if they chose not to renew a lease at the new rate, they are required to vacate on or before the last day of the lease

the pros and cons of raising the rent

1. How much are you looking to gain? Is the
rent increase more than a month’s rent on an
annual basis? If not, turning the unit over
won’t help you out in the long run as you’ll
miss at least 1 month of rent on a turnove.

2. Do you have a good renter? Trading a good renter for a bad renter can cost you a lot. If you have a bad renter, you shouldn’t be
consideringa rent hike, you should be
getting them out.

Ask yourself these questions:

a. Do they pay on time or are they late
now and then?

b. Do they take good care of the place
or are they abusing it?

c. Are they a good neighbor or nuisance
tenant?

Conclusion of raising the rent

Forget whether or not your tenant can pay, that’s not your business. Of course your tenant is never going to tell you that they got a raise and are rolling in dough. If You haven’t raised the rent on them in years, so why would they give you a reason to?

Renting out for profit is your business, are you treating it as one? Do you have profit goals for your business? You should and if you don’t you should sell your rental and put your money somewhere else.

Ask yourself if you are being fair to yourself with the rent that you are requiring. Bottom line is that you aren’t running a charity and if
your tenant can’t make the new rent, that isn’t your problem. The only reason you shouldn’t raise the rent is if it is in your financial interest to keep them (such
as the increase won’t cover the lost month) and they are a really good tenant.

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