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How can landlords collect arrears of rent?

Region: Ontario Answer # 446

Most tenants are covered by the Residential Tenancies Act, which sets out the rights and obligations of residential landlords and tenants. If you are having trouble with your tenant or your landlord and would like help, ask a lawyer now.

Negotiate a payment plan

Under the law, a tenant who does not pay rent is considered to be in arrears. Sometimes, landlords can avoid the time and expense of legal action by having the tenant sign a written agreement stating that the tenant will pay the arrears according to a set payment schedule. Tenants who are asked to sign an agreement to pay arrears of rent, should make sure that the terms of the agreement are reasonable, so that they will not default on the agreement and give the landlord the right to evict them.

If the tenant defaults on any of the payments as set out in the agreement, however, the landlord will usually have to take further steps.

Give notice to the tenant

The next thing a landlord can do to correct the problem is give the tenant a Notice to End a Tenancy Early for Non-payment of Rent. This Notice gives a tenant who pays rent monthly, 14 days to pay the rent due or move out. This Notice will state:

  • how much rent the landlord believes the tenant owes,
  • the date that the landlord wants the tenant to pay the overdue rent by (the termination date), and
  • that if the tenant does not pay the rent or move by the termination date, the landlord can apply to the Landlord and Tenant Board for an Eviction Order.

 

If a tenant pays all the rent they owe prior to when the landlord files an application to the LTB, the Notice to End a Tenancy Early for Non-payment of Rent is void and the tenant does not have to move out.

In order to void the notice, the tenant must pay both:

  • The amount of arrears (overdue rent) in the N4 notice and
  • Any additional rent payments that were due after they received the notice.

File an application with the Board

If the tenant does not pay the rent owing during the time allowed, and does not move, the landlord can file an application with the Board. They have two options:

1. Apply to the Board for an Order to evict the tenant and to collect the rent that is owed; or

2. Apply to the Board only for an Order to collect the rent, but not to evict the tenant.

Once a landlord files an application with the Board, a hearing may be scheduled. If the tenant wants to dispute the landlord’s claims, they should appear at the hearing and be prepared to give evidence.

If a landlord obtains either an Eviction Order, or an Order from the Board confirming the amount of arrears the tenant owes, they can generally enforce the Order through the Court Enforcement Office (Sheriff’s office). The landlord will be entitled to garnish the tenant’s wages, or seize and sell the tenant’s property to pay off the debt, and in the case of an Eviction Order, force the tenant to move out. At any time before the Order is executed by the Sheriff, the tenant can pay the amount in the Order and make a motion to the Board to prevent being evicted or having their wages garnished or property seized.

Report the debt to Credit Bureaus

Reporting debts to Credit Bureaus can be an effective way of recovering debts. FrontLobby offers a portal which enables landlords to directly report debts owed by both current and former tenants to Credit Bureaus. You do not require a court or tribunal order and consent is not required to report a valid debt. However, it is important to check with your local housing tribunal for any exceptions which may exist, such as those arising from COVID-19.

Collecting rent or other monies owed after a tenant moves out

A landlord can file an L10 application to the Board claiming rent arrears or compensation up-to one year after the date the tenant moved out (if the tenant moved out of the rental unit on or after September 1, 2021) and the landlord believes the former tenant owes:

  • rent or compensation
  • an amount for charges related to NSF cheques
  • costs for unpaid utility bills (utilities mean heat, electricity and water)
  • costs for damaging the rental unit
  • costs the landlord incurred because the former tenant or someone else visiting or living in the rental unit substantially interfered with the landlord’s reasonable enjoyment or lawful right, privilege or interest

For more information about collecting arrears in rent, enforcing an Order, or obtaining forms online, contact the Landlord and Tenant Board.

Help for Tenants

A criminal record will affect your ability to be approved for a residential lease. To erase your criminal record, learn more at Pardon Partners. It’s easier than you think.

If you are having financial problems, it may be difficult to rent an apartment or condominium. You can get help to clear your debt and repair your credit. For easy-to-understand debt solutions on your terms, contact our preferred experts 4Pillars and rebuild your financial future. With 60 locations across Canada, they will help you design a debt repayment plan and guide you with compassionate advice. No judgment. For help, visit 4Pillars or call toll-free 1-844-888-0442 .

If you are a Tenant, you can add your monthly rent payment to your credit report using FrontLobby. This can:

  • Contribute to improving your credit score (Renters have reported 33pts to 84pts jumps)
  • Help establish a positive credit history with a new rent tradeline
  • Improve your access to credit related rewards (better bank loans, credit cards, mortgage rates)

Help for Landlords & Property Managers

For legal advice and assistance with a residential tenancy and applications to the Landlord and Tenant Board, contact our preferred Landlord and Tenant experts Nicola (Nick) Giannantonio Legal Services .

If you are a Landlord or Property Manager, you can report rent payments to Credit Bureaus and screen Tenants using FrontLobby. This can:

  • Attract financially responsible applicants interested in building credit with their rent
  • Decrease rent delinquencies (Landlords have reported 92% reductions) and recover unpaid rent
  • Reduce Tenant turnover and improve monthly cash flow

Get legal help

If you are having trouble with your tenant or your landlord and would like help, ask a lawyer now.


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