Ok, this happens sometimes. But there actually may be a reason. Have you spoken to your tenant about the late payments? If not, I recommend that you do so. What you said here is that he pays every month but just late. Maybe it is because he gets paid by his employer in mid month. If that is the case, you are actually getting more rent every month to let this go on. There are two remedies here. If you find that he is getting paid later in the month, you can change the date that his payment is due. But at the same time, I would collect an extra month’s rent so that you can make your mortgage and other payments on time every month if this is the case. When you do this be sure that you write an addendum to the lease explaining the date due change and why you are doing this. Have the tenant sign and you sign and keep it with your lease. For use in case of disputes or need to present to a judge.)
If the tenant gives you some lame excuse for being late every month, like, “I took my kids to Disneyland and did not have enough money left to pay on time,” then your approach will be different. Remember that you are still getting paid every month and also getting more rent for having to wait, so this is how I would handle it. (oh and by the way, what is keeping you from charging a % of the unpaid rent and even a daily late fee? Are there laws in your city that prevent higher late fees for failure to pay on time?) I would again ask for a month rent ahead of time. I would also get the tenant to agree to a daily late fee so that he is charged rent (as interest) for every day that the rent is late. You may say this is too much work to figure out. To that I say, check out the software that I use to manage my apartments Smart Property Systems. I know that they are bringing out a special edition of the software called Ideal Landlord soon. It will cost you about $18 per month for one unit and you can set up the daily late fees in the system which are automatically added if the tenant is late. Plus everything else is also automated. It will make you look very professional and cause your tenant(s) to pay more attention to their responsibilities.
Finally, if the tenant has missed months of paying rent, then you should issue a 3 day notice to pay or vacate. Typically this is issued when the rent is late the first time to force payment. At the same time issue a 30 notice to vacate the premises. If they fail to pay the full amount due in 3 days, then you can start an eviction. But you also have the security of the notice if they fail to move and can provide those notices in your documents if you have to evict. It will make you look like you are on top of your business to the judge.
If you have to evict, you will need to go to court and fill out documents which will then be served to the tenant by a process server. There are process server fees and court fees for filing. The judge will need to see the lease agreement signed by both of you and a payment history showing the delinquencies plus all notifications and notices that have been sent. Do add your costs and your time for doing the eviction. Most judges will award you reasonable court fees and time by the hour you spent to manage the eviction and charge it to the tenant. Good luck.