Collecting Rent in Indianapolis During the Covid-19 Crisis

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The coronavirus, as you might expect, has required our Property Management Company to  change many of our processes. 

And while we do our best to inform our Clients about the various changes in our procedures, there’s one overriding concern that most Clients have: 

“How are you collecting rent during the COVID-19 crisis?”

For this week’s blog, we’ll discuss our collection processes during this challenging time. 

Disclaimer: Due to numerous federal and state regulations, this is a very fluid topic. We’ll do our best to keep this blog updated with current information.

Indianapolis Rent Collections for April

If you are an existing Client of ours, you should already know that April rent collections are going very well. 

As of the writing of this blog, we’ve collected more than 95% of available rents for

As a point of reference, some state apartment associations are reporting collection rates between 65%-85%, depending on the particular state. 

While we’ve historically never tracked this metric on a daily basis like we’re doing now, that 95% would likely be around 98% in a normal month.

But, we’re far, far away from normal right now. 

A 3-percentage point spread may not sound huge, and we’re actually very proud of that number, but, due to the sheer size of our properties under management, it’s affecting many, many Clients.

So, before we get into detail on what we’re doing to collect that rent, let’s first review what we cannot due 

Restrictions on Indianapolis Rent Collection Procedures

As we have discussed with our Clients, evictions, for non-payment of rent, are off the board in Indiana until May 5th. This date is likely to change as well. 

However, an even bigger impediment is a provision in the CARES Act, which prohibits evictions and late fees until July 26th, 2020 for all “covered homes.”

A “covered home” is any home that’s financed by a federally backed mortgage. This would include any home purchased with a FHA or VA loan, for example. 

“Collection by eviction” is a strategy that works. When we are forced to file eviction, which, in our case, isn’t often, the majority of our Tenants will pay prior to the eviction hearing.

So, that tactic is not available to us right now.

build-3930594_1920How T&H Realty is Approaching Rent Collections

While we cannot evict and are not charging late fees, we are still, for the most part, sending our normal and customary notices. 

Without regurgitating a lot of processes, you can read about our standard rent collection practices here.

As far as what we’re doing today, we’ll provide a general overview:

  1. System Notifications. Our system does routine reminders on all outstanding balances. These notifications are emailed to Tenants and we do receive responses from them.


  2. Targeted emails. Because of the CARES Act, we can no longer serve “Pay or Quit notices,” either. So, instead, we send targeted emails, from our Staff, and ask for an update on all balances owed. Again, these emails do receive good responses.


  3. Phone calls. For our technically challenged Tenants, or for those Tenants who simply ignore our emails, we have call everyone with an outstanding balance as well.    
  4. Payment Plans. For those who commit to making a future payment, we document everything in our system and will follow-up accordingly. In some cases, Tenants have agreed to sign a Rent Deferral Agreement, which outlines the date and amount of the expected payment. 
  5. Communicate. One of our core values is to be “Great Communicators”. If Clients will not receive rent for a given month, we communicate that to them and lay out the expectations provided by the Tenant (assuming we’ve been provided one). 

So, as you can see, there’s a lot of effort that goes into collecting rent, even during normal times. 

So, the big question is… what happens if we get no response, or a response that resembles, “I have no idea when I’ll be able to pay.”

Unfortunately, in today’s climate, since we can’t evict for non-payment of rent, we’re kinda stuck.

Do some Tenants know that? Absolutely.

Will some Tenants take advantage of that? Absolutely.

But, our experience shows that most Tenants will pay if they can. There are bad actors in every group, but they make up a very small percentage of Tenants.  

Patience in Collecting Indianapolis Rent

We’ve said this before but, in some cases, patience will be required. 

Depending on how long this crisis lasts, some Tenants may need quite some time to get caught up. Our thoughts are that for every month a Tenant is out of work, they may need up to 3 months to recover. purse-3548021_1920

This calculation obviously isn’t perfect, but it can provide a guideline for what to expect. 

So, the longer this crisis lasts, the more difficult it will be to collect all rent due.  

Keep in mind that our system obviously tracks all rent that is owed and our goal is to ultimately collect all rent that is due. 

However, as I’m sure you can understand, it may take some time to get back to normal in certain situations.  

Government Aid for Tenants will Help

Clearly, the massive stimulus package will help Tenants in a couple of key areas:

  1. Stimulus payments. These are starting to arrive and we have certainly been promised payment by some Tenants upon the arrival of these one-time payments. 
  2. Unemployment bonuses. According to sources in the unemployment office, unemployment checks with the $600 bonus are expected to begin disbursing on April 20th. Again, I think that date could be subject to change. However, once those additional funds kick-in, they should provide a solid income stream for our Tenants who are unemployed. 

Conclusion: T&H Realty Understands Rental Income is Paramount

We totally understand how all this economic turmoil is affecting our Clients and Landlords in general. 

The anxiety is there. 

Be assured that we discuss Tenant collections every day and our Staff is being as proactive as possible.

We’ll obviously keep our eye on current government restrictions and react accordingly. 

So, far, as we’ve discussed, rent collections have been better than expected.

With stimulus programs kicking in and as discussions of re-opening the economy continue, we hope we’ll all make it through this pandemic with little to no damage. 

About the Author

Jeremy Tallman

Jeremy is the Chief Executive Officer and Managing Broker for T&H Realty Services. He has been active in the Central Indiana real estate market since 2000 and leads one of the most successful single-family property management companies in the state.

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