Late Fees !

Comments(9)

• 
  RonInAZ16th February, 2005

  Ouch! $25! Kidding. How much does your bank charge when you are late? I just paid $39 for being dumb with a credit card. So maybe a higher late fee when you resign the lease. Or if they are month to month tell them that you are going to terminate the lease if they are late again.
  [addsig]

• 
  a34492318th February, 2005

  You can also determine the late fee according to the rent. I lot of apartment leases and/or landlords charge 10% of the late fee. ex: 700 rent = $70 late fee plus $10 a day everyday after the 5th of the month.
  
  Best Regards,
  William

• 
  TheShortSalePro18th February, 2005

  Back in the day, when I was teaching third and fourth graders, I learned the hard way that moreoften you can get better results by rewarding good behavoir, instead of punishing bad behavoir.
  
  It might be too late with this tenant and this lease, but in the future you might consider offering a discount for timely, or (dare I say it?) early payments....

• 
  desertrat18th February, 2005

  Thanks for your responses everyone, i guess i am kind of lenient when it comes to late fees, i know i need to be a little tougher if i am to survive in this business.
  
  i think i will adopt both approaches - the discount as well as the late fee.
  Pay on time and they get a small discount, if not accept the consequences.
  
  i like the 10% rule as the late fee, but my question is this, is there a legal stipulation on how much of a late fee you can charge ?
  
  thanks.

• 
  kenmax21st February, 2005

  if renting i build in a monthly late charge. example: if $500 is the "real" amount i want i charge $575 or $550 . i then tell the tenant if they pay on time they will have a $75 or $50 discount. you can do this and tack on an additional $50 late fee then if late it will cost them $100 or $125 more for that months rent.......km[ Edited by kenmax on Date 02/21/2005 ]

• 
  Bobe7323rd February, 2005

  Check your housing laws. We are only allowed to charge 5% of the rent for late fees. However in a small claims case I was awarded $50 which was 10% because the tenant did not question it.
  One thing that I was advised/alerted to by the section 8 office is, in a situation that a tenant does not pay the late fee, document it and keep a running record. When they move out you are justified to deduct it from their security deposit as unpaid rent/fees.
  We use $50 and it does not always deter the tenant. We also added a clause in the lease that rental payment are applied to unpaid fees first then to rent, which could leave a ballance due. If you would like the exact clause let me know and I could paste it in here for you.
  
  Robert

• 
  NewKidinTown224th February, 2005

  MD state law caps late fees at 5% of unpaid rent. All my leases set a 5% late fee as additional rent.

• 
  InActive_Account24th February, 2005

  New kid,
  What she is saying is that when claim a higher rent you can tell a pontential buyer that the property generates xxx dollars a year. Which is true, a little deceptive, but still allows you to;
  
  1) get a loan/re-fi (cashout)
  2) sell for a higher price
  
  [ Edited by hoober on Date 02/24/2005 ]

• 
  NewKidinTown226th February, 2005

  hoober,
  
  Any potential buyer who has been around the block a couple of times will check the rent roll, and the income/expense statements for the past couple of years.
  
  The buyer will do his/ner calculations on the actuals rather than a proforma projection.