Late Fees For Late Rent Payments

Discussion in 'Landlord & Rental Property Questions' started by Rainman, Jan 3, 2016.

  1. Sweetymae

    Sweetymae Member

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    f a tenant pays rent late, you should charge a late fee. Otherwise, there is no real penalty for not paying the rent on time and they could make a habit of it. Check your local landlord tenant laws. A few states do not allow you to charge a late fee and some will set a limit as to the maximum amount you can charge as a late fee.
    A $50 charge for a late rental payment is sufficient for a $1000 a month rental. The amount of the late fee should vary based on the price of the rental. For someone paying $5,000 a month to rent an apartment, a $50 late charge will not seem like much. In this case, something more in the $250 range would be sufficient.
    The fact that you will charge a fee for late payment and the amount of the late fee should clearly be spelled out in the lease agreement.
    You must also state that the late fee will be collected at the same time the late rent is paid.
     
    Last edited by a moderator: Jul 8, 2016
  2. Kate

    Kate Senior Investor

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    Sweetymae, surely you're aware that copy/pasting from about.com landlord is plagiarism and strictly not allowed?

     
    Last edited by a moderator: Jul 8, 2016
  3. blurinoctober

    blurinoctober Member

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    I have known people in the past who do late fees on the rent per day. The later the rent is, the higher the fee is. I feel like this system would work really well in making sure the rent isn't paid ridiculously late. The downside is the same one everyone else keeps bringing up; what to do if there is a valid reason they are late. Maybe something like a points or strikes system could be in place, you get so many points every time you're late and you're fee could get more extreme if it becomes a regular thing? That's a really hard thing. If you're a friendly landlord who's around a lot, it could be very tempting to let it slide, but you want to make sure you aren't also getting burned.
     
  4. Corzhens

    Corzhens Senior Investor

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    It is normal for a tenant to sometimes experience cash flow problems that they are delayed in the rental payments. So maybe the late rent payment penalty would be on a case to case basis. We had been an apartment tenant for 2 years so I can relate to the problem. The fact that we moved in to the apartment means we are hard up with our finances so do not expect us to pay the rent on time all the time. But fortunately, we didn't have arrears when it comes to rent because we saw to it that we pay on time... as much as possible.
     
  5. remnant

    remnant Well-Known Member

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    This is quite a good practice and shows flexibility on the part of the landlord. Whether the practice is likely to be abused or not is neither here nor there reason being that there would be little excuse in the event a tenant is kicked out. It also depends on the attributes of a particular tenant in question since some are ethical while others are not. At the end of if day, tenants are more likely to pay up since they have peace of mind come end month and have some 'paid' grace period.
     
  6. Angal Faria

    Angal Faria Active Member

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    This advice must help me with my rental income. I depend on my rental income. I have a lot of apartments and villas which I give in rent. Many people stay in those apartments and villas. They belong from native and abroad. But your advice must help me in making tenants do so.
    Thanks........
     
  7. gowiththeflow

    gowiththeflow Senior Investor

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    I think it is all about finding a balance. There needs to be some trust between landlords and tenants but there also need to be boundaries. Maybe write into the contract that there could be additional fees for late payment of rent but only consider this if the tenant is regularly late.
     
  8. Angal Faria

    Angal Faria Active Member

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    I agree with you. You are right that late rent payments make tenants less inclined to pay their rent. If it continued, then there was no interest will remain for giving their lease within a fixed time. They think it could not be a matter and become so lazy about paying their rent in proper time.
     
  9. Angal Faria

    Angal Faria Active Member

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    It is true that charging a late fee for late rent payment make tenants less inclined to make their payment. But it is also harmful to your rental income and affects it on your economy.
     
  10. Angal Faria

    Angal Faria Active Member

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    Yes, I agree with you. What should need to do when the delay is more than a week?
     

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