What to do if the tenant does not pay the rent and does not reply to messages? This situation can cause stress or even financial worries as a landlord.
If the tenant has not paid the rent, but responds to messages, there is more hope of continuing the tenancy. More serious follow up can take a lot of time and effort, so it is still worth trying to contact the tenant.
If a tenant doesn't pay the rent and doesn't respond to messages, it's often due to more persistent problems, such as insolvency. If this is the case, you should deal with the situation in accordance with the law and your interests.
Read our concrete advice on how to deal with the situation, from the first attempt to contact the tenant to terminating the tenancy agreement and applying for eviction.
What if the rent is late?
If it's the first time you've been a week or two late with your rent, it's not necessarily cause for concern. It is in your best interests to approach the situation calmly and with an open mind. At the same time, find out the laws, rules and obligations that apply to the landlord and the tenant.
Law on late payment of rent
There is no precise definition in the law of how long or how often rent can be overdue. However, according to the Tenancy Act, the tenant must pay on the agreed due date and, if the rent is overdue, the landlord is entitled to charge interest on arrears (Interest Act 633/1982). You can send a reminder 2 weeks before the due date, and after 2 weeks you can follow up the reminder with a demand for payment. What happens after that?
Termination of the tenancy agreement by the landlord is possible when the tenant fails to pay therent (Room Rent Act 481/1995, § 61), the case law being 2 months of unpaid rent or persistent late payment.
Rights and obligations of the landlord and the tenant in relation to the payment of rent
Landlord's rights:
- Set a security deposit of up to three months' rent, e.g. to cover unpaid rent.
- Charge interest on arrears from the due date of the rent payment and according to the Interest Act (633/1982), i.e. +7% more than the reference rate announced by the Bank of Finland.
- Send a written payment reminder if at least 2 weeks have passed since the due date or the previous payment reminder (max 2 in total).
- Senda payment request (max 2 in total) if at least 2 weeks have passed since the payment reminder was sent.
- Ask for the lease to be cancelled if the rent is overdue, either by 2 months or more, or continuously and without justification.
- File for eviction if the tenant does not leave when the lease is terminated.
Landlord's obligations:
- Make sure you tell the tenant in advance about your visits and do not enter the property without permission, unless it is an exceptional situation.
Tenant's rights:
- Reasonable time to pay, usually 2 weeks between each step: payment reminder, payment claim and termination of the lease.
- Negotiate a payment plan if financial difficulties prevent you from paying your rent on time.
- Peace of mind even if the rent is late or the lease has been cancelled and the specified departure date has not yet arrived.
The tenant's obligations:
- Pay your rent on time, but there are many issues related to this obligation, which we will go through in this article.
The most common reasons for late payment of rent
Often this is a human error or a temporary challenge that can be resolved through open communication. The tenant may have forgotten the due date due to a hurry or other reason. Unexpected expenses or late payment of wages may temporarily affect the ability to pay. Bank delays or breakdowns in payment systems may delay the arrival of the payment.
- Temporary reasons
- Busyness and stress: in the midst of it all, a day out may have been forgotten.
- Payment system problems: bank delays or technical failures
- Acute illness: due to an accident or illness, you may forget to pay your bills
- A personal crisis: for example, a divorce or a family member falling seriously ill.
- Unexpected expenses: car repair, acute illness or other necessary expenses
- Temporary unemployment: redundancy or job loss
It can be a long-term insolvency, not just one of the above, which may be due to poor employment prospects, serious illness, or debt, for example. The reason for late payments is usually temporary and mild, so contact us with discretion.
How to contact the tenant?
If the tenant is not paying the rent but is responding to your communications, the situation is probably still manageable without more serious action. Whether it is the first time the rent is overdue by a couple of days, or several times a week, it is best to be discreet in the first few contacts. So it is not a good idea to ask directly about ability to pay, although this is the most important thing as a landlord.
Try to contact the tenant to find out why the rent is repeatedly late or has not been paid for several weeks. Start with a text message or email before calling or trying other methods of contact available to you. Give them at least 24 hours to respond before trying the next method of contact.
Listen to the tenant's explanation and use it as a basis for deciding how to proceed as a landlord. Keep a record of all contacts and agreed actions for future reference.
Here are key questions for you as a landlord:
- Ability to pay: is the tenant having a temporary problem or ongoing challenges with their ability to pay?
- Payment plan: is the tenant willing to agree on a payment plan?
Constructive communication with the tenant
- Be professional: a friendly approach increases the likelihood that the tenant will respond and the situation will be resolved quickly.
- Use clear language: avoid complicated expressions and make your point directly.
- Offer to help: find out if a little flexibility in the rent payment dates would help the tenant overcome their temporary challenge.
- Document communication: keep a record of all messages and calls for possible future needs.
For example, you could say, "Hi [tenant's name], I noticed that this month's rent hasn't arrived yet. Is everything okay?"
Advice on drawing up a payment plan
If the tenant is facing a short-term financial hardship, you can grant a grace period to pay the rent at no extra cost.
If the solvency problem lasts longer, you can work out a payment plan together to deal with the rent arrears. The purpose of a payment plan is to allow the tenant to pay the rent arrears in instalments, for example in smaller monthly instalments or through several instalments.
As a landlord, you can be sure that payments will continue, even if they are sometimes late.
Make the payment plan realistic.
1. Have an open discussion:
- Find out the tenant's current financial situation.
- Ask how much he or she can pay and in what timeframe.
2. Set clear conditions:
- Payment instalments: agree on the amount and due dates of the instalments.
- Penalties for late payment: please indicate what will happen if the payment plan is not respected (e.g. termination of the lease).
3. Written contract and conditions:
- Draw up a payment plan in writing
- Both parties must sign the agreement.
- Mention interest on late payments and any other legal charges
- Agree how to communicate any changes or problems.
Example of a payment plan
This payment plan is made on [date] and is agreed between the tenant [tenant's name] and the landlord [landlord's name] in respect of unpaid rent for the period [period].
- Rent arrears
The tenant has outstanding rentals totalling [amount] due for the period [period]. - Terms and conditions of the payment plan
The tenant agrees to pay the rent due according to the following payment schedule:- Payment 1: [amount] by due date [date]
- Payment 2: [amount] by due date [date]
- Payment 3: [amount] by due date [date]
- etc.
- Duration of the contract
This payment plan will enter into force on the date of signature and will remain in force until all the rents due have been paid in full.
Signatures
[Tenant's name]
[Date]
[Landlord name]
[Date]
What to do if the tenant does not pay the rent and does not reply to messages?
When a tenant fails to pay and does not try to sort things out with you, there is cause for concern. This situation understandably causes stress as it can affect your financial situation as a landlord. At this stage at least, it is essential to keep accurate records of rent payments, arrears and all interactions in case you need to take legal action later.
Legal measures and landlord's rights
Let's look at the law on room rent (1995/481) and how it is applied in practice:
- Termination of the lease :
- If the rent has not been paid for a sufficiently long period (§ 61) - in case law 2 months.
- Submission of a notice of termination (§ 66):
- Should be done in writing and evidenced to the tenant.
- How to apply for eviction
- If the tenant does not leave the property or even respond after the notice of eviction takes effect, the landlord can apply to the district court for eviction.
You should send a demand for payment or a request for payment and be prepared for the possibility that you may have to terminate the tenancy agreement and charge arrears of rent.
Payment notification
A payment reminder, or payment reminder, is usually the first formal step where the landlord reminds the tenant of unpaid rent and gives a new payment schedule. It is a friendlier way of reminding the tenant before taking more drastic action.
If the tenant does not answer your calls or messages, send a proof of payment reminder, for example by registered letter or email.
Please note these things:
- One or two payment reminders can be sent before a payment request
- There must be 14 days between payment reminders
- A reminder may be requested at a maximum cost of €5
The payment notification must include:
- Amount and due dates of rents due
- Possible interest on late payments (+7% to the reference rate announced by the Bank of Finland)
- Deadline for payment (at the earliest 14 days after receipt of the letter)
Example of a payment reminder:
"Hi [tenant's name], I notice that the rent for [months] is still unpaid. Please make the payments due by [date]. Please contact me promptly with the reason if you are unable to pay by this date."
Payment request
If the payment reminder is not successful, the next step is to send a payment request. A demand for payment is a more stringent measure, clearly stating that continued non-payment will lead to serious action, such as collection, termination of the lease or even eviction. It also serves as proof that the landlord has given the tenant the opportunity to pay before taking more drastic action, such as collection, termination or eviction.
The landlord can send the payment claim himself, as long as he follows the legal procedures and ensures that all proof of sending is documented (e.g. email, registered mail). It is not compulsory to use a collection agency, but many people turn to professionals if one or two reminders fail.
A demand for payment puts more pressure on the tenant to pay the overdue rent before additional costs are incurred. You can make a demand for payment yourself or, if you prefer, you can contact a debt collection agency at this stage.
Please note these things:
- You should send at least one, but if you wish another, before sending the notice of termination of the lease.
- There must be 14 days between payment requests
- The cost of the first claim is up to €14, €24 or €50 depending on the amount to be recovered.
- The costs of the second claim are up to half the amount of the first claim, i.e. €7, €12 or €25.
The payment notification must include:
- Amount and due dates of rents due
- Possible interest on late payments (+7% to the reference rate announced by the Bank of Finland)
- Deadline for payment (at the earliest 14 days after receipt of the letter)
An example of a payment claim:
Hi [Tenant's name],
We found that the rent that was due on [due date] has not been paid. Therefore, the rent for the period [start date] to [end date] is still outstanding and amounts to [amount] euros.
Please make your payment, including interest, by [due date] (approximately 14 days from today). If payment is not made by the due date, I regret that I will have to take legal action, which may result in the termination of the lease and eviction proceedings.
If you have any questions or need more time to make a payment, please contact us as soon as possible.
Sincerely,
[Landlord's name]
[Phone number and/or email address]
Guidance on choosing a debt collection agency
According to the Collection Act (1999/513, § 10), the debtor, in this case the tenant, must pay the reasonable costs of collection. If you use a debt collection agency, the tenant is primarily responsible for paying them. If the tenant is insolvent or the collection efforts are unsuccessful, the collection agency can still charge you part of the costs.
Formal collection can motivate the tenant to pay. Professionals will know how to handle the situation properly, which will reduce your own stress.
- Fees:
- Check the fees charged by different debt collection agencies, as they can vary considerably.
- The commission fee is a percentage of the amount successfully recovered.
- A fixed fee means that you have to pay it, regardless of whether the claim is recovered.
- Reliability:
- Check the collection agency's background, customer feedback, and certification or other proof of reliability.
- Services:
- Find out whether the debt collection agency offers legal assistance, such as help with filing for eviction.
- The deal:
- Read the contract with the debt collection agency carefully and make sure you understand all the terms.
How to terminate a lease?
When the tenant has not responded to messages or even to a payment request, the next step is to consider termination of the lease by the landlord. Termination of the lease is a serious action that should be taken carefully and in accordance with the law.
Free lease termination forms can be found online, e.g. on the sijoituskohteet.fi website.
Conditions for termination of the lease
As a landlord, you have the right to terminate the tenancy agreement if the tenant fails to pay the rent for a long enough period or breaks the terms of the agreement.
- Rent unpaid: you can cancel the lease if the rent has been unpaid for at least 2 months.
- Breach of contract: For example, unauthorised subletting, making noise or causing significant damage to the property.
Steps to dismantling
Even if the tenant does not move out, you are not allowed to change the locks or otherwise prevent the tenant from entering the property. The tenant has the right to pay the rent due before the date of the notice of demolition, in which case the demolition will lapse.
Draw up a written notice of termination, explaining the termination and the reasons for it. Be sure to include the following information:
- Tenant's name and address
- Lease details
- Grounds for termination by reference to the section of the Tenancy Act
- Effective date of termination
- Signature Date
Evidence of the delivery of the notice of demolition to the tenant must be provided. This means that you must have proof that the tenant has received the notice. For example, you can use a registered letter or a bailiff.
How to deal with the eviction of a tenant for unpaid rent?
You can apply for an eviction from the district court when the rent is unpaid for at least 2-3 months and no reply to the payment reminder, payment request or notice of termination has been received by the due date.
Please note the following points before we look at the eviction process:
- Legality:
- The landlord is not allowed to do any work on the property, such as changing the locks or emptying the property. The eviction must always be carried out by the district court and the enforcement authorities.
- Documentation:
- All communications with the tenant, payment reminders, payment requests and other actions should be carefully documented. This will serve as evidence in any legal disputes.
- Negotiations:
- Open and friendly communication with the tenant can often prevent the eviction process from starting if a payment plan can be agreed.
- Costs:
- The eviction process can take several months, and the legal costs and bailiff fees are usually borne by the tenant being evicted.
The process is as follows:
1. Preparation of the application
- Documentation:
- Gather all evidence of non-payment of rent (e.g. payment reminders, official payment requests and a notice of termination of the lease).
- Include multiple attempts to contact the tenant (emails, SMS, phone records).
- Consolidation of the application:
- Collect all the documents and attach them to the eviction application, which will request the eviction of the tenant and the collection of the unpaid rent.
2. Filing an application with the district court
- Delivery method:
- Submit the application for a wedding licence to the district court either electronically or on paper.
- A review of justice:
- The district court will examine the tenant's insolvency and breaches of contract with the help of the annexes to the application.
3. The decision of the district court and the wedding judgment
- Adoption of a decision:
- If the tenant does not object or contest the application within the time limit, the district court will issue an eviction order.
- The content of the wedding judgement:
- The eviction notice sets out the tenant's obligation to move out by a certain date.
- The legal basis:
- A wedding judgment serves as a legal basis for continuing the wedding proceedings.
4. Starting the enforcement procedure
- Foreclosure application:
- Once you have received a wedding judgment, file an application for enforcement, together with the judgment and all the necessary documents.
- The application is submitted to the bailiff of the tenant's place of residence.
- The proposal to move:
- The bailiff sends the tenant a notice to move, usually giving them 2-3 weeks to vacate the property.
- Wedding measures:
- If the tenant does not change voluntarily by the deadline, the bailiff will take eviction measures.
- This includes the emptying of the dwelling and, if necessary, the seizure of the property to be evicted (valuable property is transferred through recovery measures, low-value goods are destroyed).
- A record is kept of all eviction proceedings, including the date of the eviction notice, the execution of the eviction and the details of the treatment of the property.
5. What to do after eviction
Once the eviction has been enforced by the enforcement authorities, the landlord must ensure that the process is completed properly and any additional costs and damages are compensated. At this stage, it is important to take care of the following:
- Inspection of the dwelling:
Check the dwelling after the eviction for possible damage. Document any damage and ensure that the property is returned to the landlord in a safe condition. - Tenant's property:
If the tenant has left property in the accommodation, the bailiff is responsible for its preservation or destruction in accordance with the law. If it is possible to keep the property, make sure that the tenant is informed of the time and place of collection, if necessary. - Use rental guarantee:
Use rental guarantee to cover unpaid rent and any repair costs. If the security deposit does not cover all costs, you can seek additional compensation from the tenant through recovery action. - Finding a new tenant:
Start looking for a new, reliable tenant as soon as possible after the end of the eviction process, to minimise interruptions to rental income and get the property back in use as quickly as possible.
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