If a tenant doesn't pay the rent, you can't evict them yourself or change the locks. You have the right to claim the debt, to terminate the tenancy agreement extraordinarily under certain conditions and, if necessary, to turn to the rent committee or a court. For a dwelling, before terminating you must give the tenant an additional period of at least 14 days to pay the debt.
Below are the steps in the order they usually come up.
First, talk to the tenant
A first late payment does not yet mean the tenant has no intention of paying. Often the reason is temporary: their salary is late, they lost their job or an unexpected expense came up. Ask directly what happened and when they can pay.
If the tenant needs time, you can agree on a payment schedule. Be sure to put it in writing. The agreement should contain:
- the total amount of the debt and which period's rent it is;
- the size and dates of the instalments;
- that the current rent must be paid separately from the schedule and on time;
- what happens if an instalment is missed.
A written agreement helps both sides. The tenant knows exactly what they promised, and you have something to show later. If the tenant acknowledges the debt in writing, it is hard to dispute later.
What you must not do
Even if the debt is large, a landlord may not take matters into their own hands. Do not:
- change the locks or prevent the tenant from getting into the flat;
- move their belongings out;
- cut off the electricity, water or heating;
- enter the flat without the tenant's consent.
Such action is prohibited even when you are in the right. It can make you liable yourself and weakens your position in a later dispute.
Demand the debt in writing
If talking isn't enough, send the tenant a written reminder. An e-mail is fine, as long as you can prove later that it was sent. Write in it:
- the amount of the debt and which period's rent it is;
- the deadline by which you ask them to pay;
- the bank account to pay into.
If late-payment interest has been agreed in the tenancy agreement, you may claim it from when the payment was due. For a dwelling, late-payment interest agreed in the contract may not exceed the limit allowed by law. A contractual penalty for late rent cannot be agreed in a residential tenancy agreement — a contractual penalty is allowed only for breach of non-monetary obligations.
When the contract can be terminated
Under the Law of Obligations Act a landlord may terminate a residential tenancy agreement extraordinarily if the tenant:
- has been late in paying the rent or the running costs on two consecutive due dates, or
- owes more than two months' rent.
Before terminating you must give the tenant an additional period of at least 14 days to pay the debt. Do this in writing or in another form that can be reproduced later, for example by e-mail. Say clearly that if the debt is still unpaid by then, you will terminate the contract.
If the period passes and the debt is still unpaid, you may terminate the contract. Do it in writing and give reasons — state the amount of the debt and the additional period you gave.
If the tenant doesn't leave
Termination ends the contract but does not take the tenant out of the flat. If they do not leave, you need a decision of the rent committee or a court. Enforcement of the decision is carried out by a bailiff.
Rent committees operate in some municipalities, for example Tallinn and Tartu. Their jurisdiction is limited by law, and not every dispute belongs there. If there is no rent committee in your area or the dispute does not fall within its jurisdiction, you go to the county court.
The whole process takes time, so the sooner you react, the smaller the debt stays.
If the tenant has already moved out
The end of the contract does not erase the debt. If the tenant left and didn't pay the rent, you can still make a claim afterwards.
First draw up a final settlement: unpaid rent, running costs and proven damage, minus the deposit. Send it to the tenant in writing together with a deadline by which you ask them to pay. If they don't pay, you can bring the claim before the rent committee or a court. For that you need to know the tenant's contact details, so keep them up to date in the contract.
The deposit
If you took a deposit when the contract was made, after the contract ends you can cover the rent arrears and other claims arising from the contract from it. For a dwelling the deposit can be up to three months' rent.
The deposit is not rent paid in advance, though. Don't agree with the tenant that they leave the last months unpaid and "the deposit covers it" — if damage turns up when they move out, you no longer have anything to cover it from.
How to protect yourself in advance
Most rent arrears can't be avoided entirely, but their impact can be reduced:
- Put a clear payment date and bank account into the tenancy agreement.
- Take a deposit.
- React to the first late payment straight away, not to the third.
- Keep all the correspondence.
- Record the flat's condition in a handover report with photos, so that when the tenant leaves it is clear what damage arose during the tenancy.
If the tenant acknowledges the debt and wants to pay it off in instalments, put it on paper as a debt settlement agreement. That way the amount, the schedule and the consequences are unambiguous for both sides.