Is your roommate paying utilities late or not paying them at all? Late payment of utility bills is a frustrating problem faced by many people living with roommates.
Utility payment disputes can be a complicated problem. A lot depends on your lease agreement, whose name is on the utility account, and whether or not you and your roommate have a written rental agreement with one another.
In some situations, a roommate has the utility account in their name; they collect the payment share from other roommates but then fail to pay the bill to the utility company. In other words, the roommate is stealing from their roommates and not paying the bills.
Unpaid utility bills soon result in power, gas, or water shut off. If the account is not in your name, at least you are not the one responsible for the debt.
However, when a roommate is not paying utility bills on time, the problem can often be resolved by taking one or more of these actions:
- Use an app or message board to track utility payments
- Create a Roommate Agreement covering utility payments
- Complain to the landlord about the problem
- Write a ‘Demand Letter’ requesting utility payments
- Sue your roommate for unpaid utility bills
- Find out why your roommate is paying utilities late
In some situations, moving out may be the best option if you are living with a roommate who collects your utility payments and then doesn’t pay the bills. That’s called stealing.
Read on for a detailed discussion of these options, and more.
1. Your Roommate is Paying Utilities Late due to Financial Problems
If you discover that your roommate has a financial problem, you could offer to help them for a limited amount of time.
Maybe you can agree to pay the bill for a month or two, and they can pay you back later. If you do this, be clear about exactly how much help you can offer and for how long.
Put your offer in writing, and ask them to sign the agreement with you.
The person may also be eligible for financial assistance, and maybe you can help them find out about applying for help.
If they are a student, they may qualify for financial aid. Local charities and non-profit agencies also sometimes offer limited financial support for utility bill payments.
Or, maybe your roommate needs help or encouragement to find a job, so they will have enough income to cover their expenses. You could offer them some ideas on employment options.
2. Your Roommate is a Newbie to the World of Paying Bills
If your roommate is living on their own for the first time, they may genuinely be ignorant about the necessity of paying bills by the due date.
They may not understand that if you don’t pay the electric, gas, or trash pick-up bill, the services will be shut off.
When services are shut off, you may then incur interest payments and re-connection fees on top of the overdue payments or even have trouble getting the service reestablished.
You can explain this to your roommate.
Show them the utility bill when it arrives or give them a copy of the invoice. Put a red circle around the due date and amount owed and explain the consequences of not paying on time.
Seeing the bill may help them understand and learn about this reality of adult life.
If your roommate frequently pays utilities late, you could also ask them to start paying a month in advance.
Keep written records of who pays, when they pay, and a copy of all bills, so you have evidence if a dispute arises.
However, even if your roommate does not pay up, you need to make the payment yourself and then collect it from them later, if possible.
If the utility account is in your name, making the payment on-time is especially important.
When overdue utility payments go to a collection agency, it can hurt your credit rating and damage your ability to open new accounts in the future.
3. Your Roommate is Late on Utilities due to Fairness Issues
Often, when a roommate pays utilities late the problem has to do with an issue of fairness.
For example, a roommate may not be at home very often and think they are not liable for payment of a full share of utilities each month.
Or, maybe you have a bigger room or you have more friends come over, and your roommate thinks you should pay more utilities as a result.
Paying unequal or pro-rated shares on utilities is something for you and your roommate to decide between you.
The best time to make this type of decision is before you start living together, but you can work out a fair payment policy at any time.
Many roommates split the cost of all utilities regardless of who is home more or who cooks more. Other people look at all of the factors involved in each month’s utility payment and pro-rate the share accordingly for each person.
Pro-rating each payment may seem like the fairest way of handling utility bills. However, it takes time and effort for someone to figure out the bills each month and keep track of everything, although you can use an app for this (more about that later).
The critical point is to work out a payment system everyone can live with.
Then put the agreement in writing, and always pay bills on time one way or another to avoid a service shut-off.
4. Is Your Roommate is a Deadbeat?
Some roommates are deadbeats who don’t care about being responsible for paying utility bills on time.
If your roommate consistently makes excuses for late utility bill payments, doesn’t follow through with what they promise, or they try and shift the blame to you, you may be in this situation.
Unfortunately, people like this seldom change their ways.
If you are nice to them, they are likely to see you as someone they can exploit further. In this case, the best solution may be to protect yourself by paying the bill and finding a new living situation.
You might also consider taking legal action against them later to recover your costs.
If you decide to move out on a deadbeat roommate, and the utility bills are in your name, be sure to contact the company and close the account before you move.
Don’t rely on your roommate to transfer the account into their name. They may not do it, and you will still be responsible for the debt, even if you have moved out.
Also, pay any due bills on accounts with your name on it, even if you can’t collect the money from your roommate.
Doing this is essential for protecting your credit rating and your ability to open new accounts in the future. Your lease may also require it, and non-payment of utility bills could be cause for eviction.
5. How to find out the reason for Roommate Paying Utilities Payments Late
When someone is not paying their bills on time, it usually comes down to one of these four reasons:
- The person has financial problems.
- The roommate doesn’t understand why you must pay bills on time.
- There is a disagreement about everyone’s fair share of the utility payments.
- The person is a jerk who does not care about paying their bills.
Talking to the other person at a calm and relaxed moment can help you figure out which of these is the case.
Ask your roommate to schedule a time with you to discuss the household bills.
When you meet, start by asking your roommate what is causing them to pay their utility bills late. Be respectful and avoid becoming accusative. Money is a touchy subject for many people.
6. Create a Roommate Agreement Covering Utility Bills
A roommate agreement is a written agreement between roommates similar to a rental agreement with the landlord.
The agreement covers things such as when rental payments are due, how utility bills will be shared, when utility bill payments are due, and even who cleans the bathroom and kitchen.
Roommate agreements are usually legally binding. However, this type of document does not have the same legal force of a lease in most places, and it can’t have any provisions that violate the rental agreement you have with your landlord.
However, if you have a written roommate agreement, and your roommate violates it, this document might make it easier for you to take legal action against them. It also gives you more leverage demanding payment for utilities.
If you did not sign a roommate agreement when you moved in together, consider asking your roommate to sign a contract with you now.
When you put a deal in writing and everyone signs it, it becomes a lot harder for roommates to make excuses about late utility payments.
You can find roommate agreement templates online. Be sure to get one designed for the state you live in, and make sure you don’t put anything in it that violates the lease you have with your landlord.
7. Complaining to the Landlord When Your Roommate Doesn’t Pay Utility Bills
If your lease requires you to make utility bill payments to the landlord and everyone’s name is on the contract, making a complaint to the landlord may be effective.
You may be able to have the roommate evicted for non-payment of these bills.
Don’t just knock on your landlord’s door and start telling them the problem. Instead, write a letter stating the facts and send it to them by certified mail. By doing this you create a paper trail, which could protect you in the future.
If your lease states you are responsible for opening utility accounts in your name, the landlord might not be able to help you. However, if he or she knows your roommate is not financially accountable, the landlord may let you move into a different apartment or housing unit.
They may even evict the non-paying roommate to keep the peace and keep up the reputation of their rentals.
8. Apps and Aids to Get Roommates to Pay Utilities On-Time
There is an app for everything, including ones for sharing and tracking utility payments. Splitwise and Settle Up are only two of these apps you may want to consider using.
These apps calculate everyone’s share of the bills and send reminder notices when payments are due. If roommates are paying unequal shares on utilities, an app can make this much easier.
Some apps also include features for making payments between roommates using PayPal or Venmo. You may even be able to make the payment to the utility company using the app.
Old-school methods for tracking utility bills include whiteboards and chalkboards hung in a prominent place, such as the kitchen or living room. Whoever receives the bill immediately puts a message on the board, alerting roommates about how much each person owes and when the payment is due.
An advantage of this type of system is it is highly visible, and everyone’s payment or lack of payment is easily seen by everyone else.
Having a visual reminder about utility payments can put a subtle but effective psychological pressure on roommates to pay on-time without you having to get personal about it.
One roommate I read about used humor to get the money for utility payments. She had a large collection basket with a “payment due” sign on it and a copy of the bill. Then she went around the apartment with the basket when everyone was home, asking each person for their share.
The other roommates thought this was funny, and the humor helped overcome their resistance to paying her when the bills arrived.
9. Sending Your Roommate a Demand Letter for Overdue Utility Bills
A demand letter is a formal, written method for requesting others to take a specific action.
Sending a demand letter is like making a formal complaint.
Also, if you decide to take your roommate to small claims court for money they own you, sending a demand letter first is likely to strengthen your legal case.
You can find resources for creating a demand letter from Nolo Press, but here are the basics:
- Start by giving details about what is going on. For example, “I gave you copies of utility bills with your share clearly marked for August, September, and October, but you failed to make any payments to me.”
- Go on to explain, step-by-step, what action you took, and how your roommate responded or did not respond. Keep it professional and to the point. Don’t make threats or disparaging comments; just lay-out the facts.
- Next, write down what you expect them to do. For example, “I expect full-payment of these late utility bills by November 15th.”
- Finally, tell them what you will do next if they fail to comply with your request. For example, “If you do not make these utility bill payments by that date, I will take you to small claims court to recover the money.”
Keep the letter as short and well organized as possible, and imagine how it will sound to a judge or someone else who does not know you or your roommate.
Make a copy of the letter for your records and send the letter to your roommate by certified mail, signature required. This way, you will have proof they received it. Be sure the letter contains your mailing address and the date as well.
Just receiving such a letter may be enough to let your roommate know you are not going to put up with them not paying their share of utility bills.
If not, you can take the next step and try to recover payments using a small claims lawsuit.
10. Suing a Roommate for Unpaid Utility Bills
Small claims courts allow a person to file a lawsuit against someone else without having to hire a lawyer. Each state has its specified limits on how much you can sue for in small claims court. In most states, the maximum amount is between $2,000 and $15,000.
Courts charge fees for filing a small claims lawsuit, and the amount varies from one place to another. You may also have to pay a fee to have the legal papers served to your roommate.
Investigate the costs in your location to see if it’s worth taking this action.
If you do decide to file a small claims lawsuit, you must do so in the county where the dispute exists, namely, in the county where you and the roommate reside.
Here are the basic steps for filing a small claims lawsuit.
- Go to the County Clerk’s office in the county where you have the dispute and ask for the correct forms for filing a small claims lawsuit and pay any required fees.
- Depending on your local laws regarding small claims lawsuits, the County Clerk or Sherriff’s Department will send a certified letter to the person you are suing, informing them of the suit. This process is called ‘serving the papers.’ You cannot do this yourself because you are a party to the lawsuit.
- After you have received notice that your roommate has been served the papers, you will need to file a “proof of service” form with the County Clerk. Ask the Clerk’s office if you have questions about how to do this.
- The court will then set a date for your hearing before a judge. While you wait for the hearing, organize all of your paperwork and documents, and make several copies of everything.
- Attend the hearing with all of your documents neatly organized. Include a copy of your demand letter, utility bills, lease agreement, and any other evidence supporting your claim.
- Follow the judge’s instructions when you are asked to speak and keep to the facts without getting sidetracked.
Even if the judge decides in your favor, you may still have a hard time getting the money from your roommate.
However, even if the roommate never pays you, you will have created a record of a legal judgment against them, which will follow them in the future. By doing this, you may protect other people from being exploited by this person.
Living with a roommate who is consistently not paying their share of utility bills is a frustrating and potentially expensive experience you want to avoid, if at all possible.
Before you move in with someone, consider running a credit check on the person to see if they are financially trustworthy, or ask others who know them about their financial reputation.
If you already live with someone who is not being financially responsible, consider moving out as soon as possible to protect your wallet and your peace of mind.