Tips For Managing Arrears

• Check the arrears at least twice weekly to keep on top of them (daily follow up of arrears can be seen by SACAT as tenant harassment). Invoice arrears should be followed fortnightly at a minimum

• Always try and work with the tenant, not against them.   If you treat them with respect in discussing any issues around arrears, you are more than likely to be successful in getting them addressed quickly.   

• Offer them a plan to get the arrears paid off over a period if they are struggling to pay the arrears.     Even $20 extra per week is better than nothing

• Keep your landlord up to date

• At lease renewal time, make sure any arrears (rent or water) are addressed before renewal is offered.

Rent - View the report

Step 1: Click on your dashboard in PMe then click on the arrears section  

Step 2: The right hand side in orange or red will show you any tenancies in rent arrears by the number of days

Step 3: A form 5 should be served after 16 days of arrears.

Follow up

Rent arrears need to be followed up from 2 days onwards. Text messages are automatically sent out to tenants at 2 days, 5 days and email at 10 days but it certainly doesn't hurt to give the tenants are call every now and then.

At 9/10 days, it is best practice to let the landlord know of the situation by phone (or email if you can't get hold of them)

Email template in Property Me - Rent Arrears>O>Day 9 Reminder

At 16 days, a Form 5 (Notice of Termination) needs to be issued to the tenant and sent with

Email template in Property Me - Rent Arrears>T>Form5 Rent

The landlord also needs to be advised. Best practice - ring them first

Email template in Property Me - Rent Arrears>O>Form5 Rent

Create a Form 5

This can be done via Forms Live or through the integration function with Property Me.

Step 1: For integrations, follow the steps below. Alternatively go directly to Forms Live. From the tenant folio, click on the Forms drop down to find MS Form 5 Notice to tenant to remedy breach, notice of termination

Step 2: Click on the option to edit form in Forms Live

Step 3: This will auto populate the tenants name and property address. You will need to manually fill in the rest of the information.

Step 4: Select the type of breach as "Unpaid rent only"

Step 5: Breach details

What is the breach?

The wording format should be as follows as this gives the tenant a clear indication of the dates rent payments were due and the amount owing.

If there is a part payment, list it is - Rent of $980.00 due on 13/05/2022 is part paid $600.00. $380.00 not received

What wording is used to remedy the breach.

This does not need to be extensive at all. Just details of the total amount of rent owing and if there is a part payment amount in Property Me, this must be deducted from the total i.e. The total rent payable = $1960.00

Part 2 – what date do I enter?

The tenant must be given 7 days’ notice of the breach so the date will be 7 full days from the date you have emailed the notice. E.g. today is the 1st, so the remedy date will be the 9th. This leaves 7 full days in between.

Part 3 – what date do I enter?

This is the date after the date given to remedy the breach e.g. Tenant had to the 9th to remedy, so the date of termination is the 10th.

Part 4

Make sure you enter the date you have issued the notice. The email/fax option is to be ticked and the email address of who the notice has been sent to, is entered

NOTE: if the tenant doesn’t have email option and the notice needs to be mailed, you will need to ensure that the date in Part 2 is enough notice to allowing for mail delivery delays.

Part 5

Agents’ details are already prefilled so nothing more to do in this except sign.

Step 7: Sending a Form 2

A Form 2 - Notice to enter premises to determine whether breach has been remedied - is required to be served after a Form 5. You will need this form to be able to enter the property to check if the tenant has vacated or not if they don't pay their rent arrears. This can be served the minute after a Form 5, and needs to be in a separate email.

Invoices - View the report

Property Me is set up to automatically send the tenants SMS reminders on outstanding invoices at 2 & 7 days.

If the payment remains outstanding, the tenant needs to be followed up by phone call or if you are unable to contact them, there is an email template available.

Invoice Arrears>T>Final Reminder Email/Letter/SMS

Invoice Arrears>O*>Payment Plan

Step 1: Click on Accounts then Invoices on the left hand side panel of the screen in Property Me

Step 2: Filter to your portfolio then click on the due tab and this will show you all tenancy invoices currently due

Step 3: Wanting to send a copy of the invoices with the email?

a) You can either find the original invoice sent in the activity in the tenant profile and then click re send, or

b) Click on the invoice picture (blue link). That invoice will open. You can then click "Send in Email"

Step 4: If the invoice arrears exceed more than one week's rent, or are unpaid for over a month, it is suggested a conversation is had with the landlord about issuing a breach notice. While issuing a Form 5 for invoice arrears will automatically terminate the tenancy if unpaid, it is highly unlikely that a tenant would vacate for owing an amount equivalent to a week's rent.

Create a Form 5

Follow the same steps for rent arrears, making note of the differences required.

The breach is:

"Invoices number 123456 for $12.45 due on 12/2/2024 remains unpaid for more than 14 days"

To remedy the breach:

"Pay amount outstanding of $......................... for invoices issued

Part 2 – what date do I enter?

The tenant must be given 7 full days’ notice to remedy the breach so the date will be 8 days from the date you have emailed the notice. E.g. today is the 1st, so the remedy date will be the 9th

Part 3 – what date do I enter?

This another 7 days after the date given to remedy the breach e.g. Tenant had to the 9th to remedy, so the date of termination is the 17th.

Sending a Form 2

A Form 2 - Notice to enter premises to determine whether breach has been remedied - is required to be served after a Form 5. You will need this form to be able to enter the property to check if the tenant has vacated or not if they don't pay their rent arrears. This can be served the minute after a Form 5, and needs to be in a separate email.

What happens once the termination date is reached?

The tenant pays

• No further action can be taken unless the rent arrears remain more than 14 days in arrears.   

If the tenant wants to enter a payment plan, this should still be formalised by SACAT so an application should still be lodged. However, before taking this action, speak with the landlord as the application does incur a fee which is non-refundable. For the first time offender a mutual agreement payment plan should suffice.

What is a payment plan ordered by SACAT?    The tenant will be required to make their normal rent payments, plus an amount off the arrears, by a particular date.   If the payment is not met, the matter can be referred to SACAT for a vacant possession order.

The tenant hasn’t paid and remains in occupation

In the case of rent, make an immediate application to SACAT for possession and advise the landlord. For invoices, call the landlord and discuss if they want to seek an order through SACAT   

The tenant vacates

Commence vacating process & advertising. The tenancy will be finalised as a lease break.