Finance3 October 20267 min read

What to do when residents won't pay service charge

A step-by-step approach for estate committees and facility managers: find out why, remind the right way, offer a plan, and know your options when nothing else works.

By The BreeUp team

Apartment buildings on Lagos Island at dusk

Every estate has households that fall behind. A few are refusing on principle, but most are confused, stretched or waiting for someone to ask them properly. The way you handle the first group decides how much trouble you have with the second, so start with the quiet fixes before you reach for the heavy ones.

First, find out why

They don't know what they owe. The amount, period or account details were only ever posted in a group chat.
They think they've paid. A transfer went in without a reference and nobody matched it.
Landlord or tenant? The tenancy agreement says one thing, the landlord says another, and the estate is chasing the wrong person.
They disagree with how the money is spent. The real complaint is about the generator, the security firm or the accounts.
They can't afford it right now. A lump sum for the year is a lot to find in one month.
They simply won't. Usually a small number, and they watch how the estate treats everyone else.

The Households page listing every unit with its status and outstanding balance — Start with the facts: which households owe, and how much.

Fix the bill before you chase the payer

Make sure every household has received a clear bill: the amount, what it covers, the due date, the estate's account details and their own payment reference. Check your records for transfers that came in without a reference. A surprising share of "defaulters" turn out to have paid.

The Create Invoice form with household, invoice type, amount, note and due date fields — A clear bill says what it's for, how much and when it's due.

Remind in steps, privately

A friendly reminder
A short personal message a few days after the due date, with the amount and how to pay. Most late payers settle at this point.
A firmer reminder
Two weeks later, mention the amount outstanding and ask them to pay or get in touch to agree a plan.
A conversation
A call or a visit from a committee member. You'll learn more in five minutes of talking than in five messages.
A formal demand letter
A written notice, signed by two executives, stating the amount, the period, a final date and what the estate will do next. See our service charge demand letter template.

The payment ledger with a WhatsApp reminder button on each unpaid invoice — A personal reminder on WhatsApp, one household at a time.

Don't name and shame. Posting a list of defaulters in the residents' group feels effective, but it shares personal information, embarrasses households who were about to pay, and starts arguments the estate then has to manage. Share the estate's overall collection rate instead.

Make paying easier than not paying

Offer a payment plan in writing: the arrears split over three or four months, alongside the current charge.
Bill monthly or quarterly instead of once a year, so the amount is easier to find.
Let residents pay ahead with a small discount, so the reliable payers are covered for the year.
Show where the money goes. Residents who can see the security and power spending argue far less about paying for it.

Pay-ahead options on a phone: 3 months, or a year with 1 month free — Letting residents pay ahead keeps reliable payers covered for the year.

Tenants and landlords

Whoever the tenancy agreement makes responsible, the property owner is usually the one bound by the estate's deed of covenant or rules. If a tenant won't pay, write to the landlord as well. Keeping a directory of who owns each unit, not just who lives there, saves a lot of time here.

A residential building behind palm trees in Lagos — In blocks with many tenants, the owner is often the one bound by the estate's rules.

Use your estate's own rules

Your deed of covenant, estate constitution or association bye-laws set out what residents must pay and what happens if they don't. Common sanctions include late payment charges, loss of voting rights at the AGM, and losing access to optional services like estate facilities. If your rules don't cover arrears, propose a clear policy at the next AGM, so it's agreed by residents rather than imposed by the committee.

A padlocked metal gate — Locking a gate on a resident can cost the estate more than the debt.

Be careful with self-help. Locking people out, blocking their visitors or cutting off water or power can expose the estate and its executives to legal claims, even when the debt is real. Get legal advice before taking any step like that.

When nothing else works

Mediation: a neutral third party, such as the Lagos Multi-Door Courthouse in Lagos, can settle disputes faster and more cheaply than court.
Small claims: several states, including Lagos, have small claims courts for straightforward debts, designed to be used without a long, expensive case.
A lawyer's letter: a demand from a lawyer, citing your estate's rules, often settles the matter on its own.
Court: the last resort. Your records will matter, so keep every bill, reminder and reply.

The resident's Bills page on a phone, showing the amount due and a Pay button — When residents can see exactly what they owe and pay in a minute, fewer fall behind.

Prevent the next round

Arrears are much easier to prevent than to collect. Recurring bills that go out on time, personal reminders, receipts that arrive immediately and accounts residents can see make the estate a place where paying is normal. BreeUp handles the billing, reminders, receipts and records, so the committee can spend its time on the few conversations that need a person.

The Recurring bills page listing an estate's service charge and levies — Recurring bills go out on time every period, so arrears don't build up unnoticed.

How BreeUp helps

BreeUp keeps a clear who-owes list, sends receipts for every payment, and lets residents see where the money goes through the spending log. Seeing the spending is often what turns a reluctant payer around.

Reminders go privately, one household at a time, with copy-ready WhatsApp messages. Residents can pay in parts or months ahead, and admins can agree payment plans. With the visitor passes add-on, the estate can also let guards check whether a home is up to date. Guards see only "up to date" or "owes", and it's off unless the estate turns it on.

Read our guide to enforcement tactics and their legal risks, or set up your estate.

This is general guidance, not legal advice. Estate rules and state laws differ. For anything beyond reminders and payment plans, speak to a lawyer who knows property law in your state.