If you’re a Meridian Property Management client, here’s what you need to know
This is Part 1 of a two-part series
This month, an employee-investor provides a first-hand account of the current eviction process in the Memphis area. In Part 2, we’ll report on what typically happens as an eviction case moves through the courts. If you have any questions, please contact Hope Reyes, director of operations at Meridian Property Management (MPM), at 901-341-0345.
Last month, I received an email from my property manager (PM) notifying me that she filed for eviction on one of my residents. After digesting the news, I realized I didn’t know what would happen next. My intention is to share what I learned after speaking with the team at MPM.
First, a reminder that evictions are not common. In fact, MPM’s rent collection rate hovers around 99.5% each month, well above the industry average. The PMs work diligently to reach residents who have not paid in full by the first of the month. When they do speak with them, they assess the situation and then make payment arrangements. It’s only when a resident becomes uncommunicative that further action is taken.
MPM’s policy is clear: “If a resident has not paid rent and not communicated with MPM by the 10th of the month, or if half the rent due has not been received by the 15th of the month, MPM will proceed with an eviction filing,” MPM instituted this policy, and the early use of attorneys, to minimize lost rent and diminished returns for investors because the courts are taking longer to process evictions post COVID.
The initial cost to file for eviction in DeSoto County, Mississippi is $299. Other counties in the Memphis region have similar fees. Once an eviction is filed with the court, MPM posts a bright orange “Final Notice to Pay” sign on the resident’s front door. I was told that this often gets the resident’s attention, and s/he pays in full right away or makes payment arrangements, which MPM is happy to accommodate so long as the resident remains communicative. In my case, this is exactly what happened. Within 24 hours of the notice being posted, the resident made a full payment, including assessed late fees, and my PM canceled the eviction filing with no changes incurred.
In talking with the team, I learned there’s been a slight uptick in eviction filings this year; they are now at pre-COVID levels. Yet, the majority have turned into “pay and stay” agreements. These agreements allow the resident to stay in the home through the end of the lease so long as rent is paid. Before extending a lease renewal, the PM will inspect the property thoroughly and take a holistic view of the tenancy (e.g., Did the resident pay on time, stay communicative, or violate any HOA rules?). This approach benefits both the homeowner and the resident, as it helps to keep the properties in prime condition.
While many consider real estate to be a conservative investment – it’s not without risk. Under MPM’s policy, residents are responsible for all eviction-related expenses, as well as unpaid rent and damages, if any. Unavoidably, there are situations in which residents neither cooperate nor pay, even when faced with eviction, a tarnished rental history, and collections. It goes without saying that no one wants to see a resident evicted, and MPM’s PMs do all they can to provoke a response from a resident and facilitate a quick resolution. Only when they’ve exhausted all means of collecting the agreed-upon rent do they file.