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Late fees for rent... What does your lease require?
My state law says the late fee has to be a reasonable approximation of what the actual costs are. I'm trying to determine what is a reasonable late fee and how does one arrive at that?
We charge $ 50.00 and $ 5.00 per additional day...
I have even charged $ 100.00 + $ 5.00 per day and when I was in court the judge looked over the lease and never said a word about it...but it might differ when it comes to how high the rent amount is.
I charge a $50.00 late fee plus $10.00 per day. I have a due date of the first, payable by the third. On the fourth, the fee is $50.00 and $10.00 a day additional after that. I too have been to court and the lease read by the judge who always has aid I am owed the money or tells the tenant to get out.
You have expenses whether the rent is paid or not. Being a reasonable amout is a judgement call.
Late fees for rent... What does your lease require?
My state law says the late fee has to be a reasonable approximation of what the actual costs are. I'm trying to determine what is a reasonable late fee and how does one arrive at that?
We charge 10% of the total rent, that is in our lease, however we have never really had to enforce.
My latest lease will have a prepayment credit of $50 if paid prior to the first, on the first the rent is then the normal rate, and then an additional $50 if not paid by the 5th, then I think I'll add that $10 a day after that too. The whole point being not to actually get the additional rent, but to encourage the tenant to pay on time if not sooner.
I appreciate everyone's sharing. My lease currently says rent is due on the 1st and the late fee is $20/ day after the 3rd of the month. It doesn't seem to unreasonable considering there is no large fee on the very first day it is late.
Yeah a large fee would be unreasonable. Mine will clearly state the actual rent amount, with the 50 being a prepayment discount. Miss paying early and you pay the actual rent, then after that, its late.
Wireyourworld, I am curious, have you had good luck with the prepayment discount? (I wish my landlords had offered that when I was renting, I would have taken advantage of it every month!)
When I was renting the penalty was $30 starting on the 3rd of the month, although that was about 10 years ago. The only time I was late (late by 1 day after several years of a perfect record) was because I was in the hospital and forgot to pay it before I went in. I gave my ll doc. and he waived the late fee.
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