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What can a landlord do if the tenant cannot afford to pay?

What can a landlord do if the tenant cannot afford to pay?

On Behalf of | Mar 2, 2021 | landlord-tenant disputes |

While it is easy to think that landlord-tenant disputes always involve an argument over a term in the lease or about New York’s landlord-tenant laws, perhaps common reason for litigation is that a tenant simply cannot keep up with the rent because of financial problems.

For a commercial landlord, deciding what to do about a tenant who has fallen behind is not always simple.

At first glance, and in normal times, an eviction may seem like a good option, but the problem is that an eviction and even getting a judgement for back rent is no guarantee that the landlord will actually receive payment.

In the meantime, the landlord has find another tenant for the property. Even in hot real estate markets, this will involve some time, expense and lost income.

Negotiations with a delinquent tenant may be the best course of action

What a commercial landlord in the Queens are or surrounding boroughs should do in its specific circumstances is really a question best answered by an experienced attorney.

However, landlords should at least consider whether a firm but realistic negotiation with a tenant who has fallen behind may be the best option.

Landlords have a number of solutions they could potentially offer a tenant who because of financial problems cannot pay rent.

Even if forgiveness of all or part of the rent is not an option, the landlord may agree to defer payments and allow the tenant to catch up over time or pay the missed rent in a lump sum at a later date.

The landlord may also consider converting the back rent into an interest-bearing loan by having the tenant sign a promissory note for it.

It is possible also for the landlord to offer a modification of the lease to make the rent more affordable going forward.

On a related point, the landlord may be willing to help the tenant sublet the premises so the landlord can continue to receive income even if the tenant vacates.

If the original lease called for a deposit, the landlord may offer to apply all or part of that deposit to the delinquent rent and then either continue the relationship without those funds or have the tenant replenish the security deposit over time.