Ontario Residential Tenancy Act - Clarification please...

[Bajic]

[pre]Hello fellow Seasoned and New Rein investors!

I am currently in the process of reading the residential tenancy act. I am currently having a difficult time in comprehending what some of these laws and regulations mean.

In part VII - Rules relating to rent, section 106; subsection (6), it states "A landlord of a rental unit shall pay interest to the tenant annually on the amount of the rent deposit at a rate equal to the guideline determined under section 120 that is in effect at the time payment becomes due".

(1)The landlord has to pay the tenant interest on the rent deposit with what the current guideline rates are going for the year? When do we pay this interest? Am I understanding this correctly? Could someone kindly give me an example in order for me to understand this better?


(2)Also in regards to in regards to a tenant for non-payment of rent. How many days do you give the tenant after they are late before you provide them a notice of terminating tenancy?

(3)Section 80 states " The order of the Board evicting the tenant may not be effective earlier than the date of termination set out in the notice". Assuming there is no motion filed to the board typically how many days is this after the notice of termination of tenancy is issued?

Thank you very much!

Aaron.[/pre]

 

[invst4profit]

1) On the anniversary date of the lease, However if you raise your tenants rent every year by the allowable amount the tenant is required to top up their LMR therefore the interest you owe them and the amount they owe you cancel each other out. Explain this to your tenant and you will not pay them anything. If you are actually holding their LMR in a separate account you could apply the payment to that account, If not their LMR when applied will be the original amount deposited and not there current rental amount.



2) Always give notice on the second of the month if payment is not received by midnight on the first. There are two different notices that could be served. The N4 which is a eviction notice that allows a tenant 14 days to pay without penalty. This is why you serve it on the second of the month. This notice is a waste of time in my opinion as tenants know they have 14 days to pay and if you end up at the board they will simply be ordered to pay, your eviction request will be denied and you will lose the eviction and your $170 filing fee.



My personal preference is to immediately file a L9 on the second of the month. This is simply a application for rent owing. The L9 is the most effective tool a landlord has to train tenants to diligently pay on time all the time. The tenant gets no warning, the minute you file the L9 the tenant not only owes you their rent but will also be forced to pay the $170 filing fee. Their is no grace period. Tenants that use landlords as a source of revolving credit are usually shocked to have one use the L9 rather than the N4. Even if they pay their rent prior to the hearing they still will owe you the $170. You will find it is a rare tenant that makes the mistake of paying late a second time.



3) There is no set time period. The board will try and draw it out as long as possible to assist the tenant. But this generally is not relevant because in Ontario your chances of actually being successful at evicting is slim to none.

 

[Bajic]

Awesome! Thank you very much Greg!