Some of our merchants are membership-based and funds are either withdrawn from checking or a credit card automatically.
This afternoon I received a call from one of my best tenants, requesting a split rent payment schedule in January; the reason for his request is pretty clear with the headline above. Thinking there was a processing error, he called the company who processes the payments, only to find that they’ve been flooded with similar calls since January 1 from all over the nation.
Obviously the payors are contractually obligated to make good their commitment, however this is an alarming percentage of defaults.
While the major credit card issuers’ mid-December estimate of a 4% default rate falls far short of the reported 30% declines which could be simply over-limit in some cases, it’s still up 26% from the previous period according to a recent CNN Money article. We’re all familiar with home equity defaults and foreclosures; so what’s next? Auto loans, and debt on those toys like Waverunners is my best guess.
What do you think?
Oh, and of course I agreed to half the January rent now and half on the 15th. When you’ve got a great tenant who has a plan and gets blindsided you go to the wall for them.
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John you are just a generous person!
LC:
I loved the info on the WordPress Tags and the Rich Dad, Poor Dad review. There are so many articles to read that I will have more feedback for you soon. You are my hero and good luck in your MANY endeavors!!