Atlanta Property Management Blog

Notice of Strict Compliance

One of my mentors in property management has a saying I have found valuable in my career: "Never accept assurances in lieu of money." Early in my career, when I managed a small number of rental homes I personally owned, I had not yet met my mentor. I did accept tenant assurances in lieu of money quite a few times.

All these situations turned out the same way. I was accepting rent later and later in the month. My lease said rent was due on the 1st and a late fee was due if rent was paid after the 5th. I was routinely accepting rent on the 15th or the 25th without requiring late fees or filing dispossessories. I made all kinds of accommodations to tenants that amounted to what is in Georgia called Mutual Departure from the Lease.

Mutual Departure is an important concept in property management. If your lease states that rent is due on the 1st and a late fee is due if paid after the 5th, and you have accepted rent paid on the 25th day of the month six times in a year without requiring a late fee, then you and the tenant have "mutually departed" from the terms of the lease. This means that in Georgia, no matter what your lease says, you have created a situation where the rent is now due on the 25th day, and no late fee is required. An even worse situation is created if you have habitually accepted short rent. Let's say your lease states the monthly rent is $1500 but you have given your tenant a break and accepted $1000 three months in a row. Guess what? Due to the law on "mutual departure," the rent the tenant owes you is now $1000 per month no matter what the lease says.

Let's say that you have decided never more to accept assurances in lieu of money. You have learned your lesson and now wish to insist on strict compliance with the terms of your lease. If in your tenant relationship you have created "mutual departure from the lease," in Georgia you must now cure this defect before you can insist on strict compliance. That is subject of this video: The Notice of Strict Compliance. Download the form letter from my website, fill it out, give the tenant at least 10 days notice (I give the tenants 30 days notice), and you're ready to return to strict compliance with the terms of the lease.

As a summary: If you have created "mutual departure" from the terms of your lease, you may return to strict compliance only by giving the tenant written notice of strict compliance. The "Notice of Strict Compliance" form letter, included in my "DIY Landlording Resource Library," will do the job.

My name is Andy Ritan and I am the owner and broker of Atlanta Property Management Group, a residential property management company in Atlanta, Georgia. My "Notice of Strict Compliance" form letter is part of my DIY Landlording Resource Library, which you may download for free from my website, atlantapropertymanagement.com.

I am not an attorney and do not provide legal advice. The materials available at this web site are for informational purposes only. You should contact your attorney to obtain advice with respect to any particular issue or problem.

Good luck out there! If you should decide to seek professional management I hope you will remember my company.

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