Hey All –
Wanted to get your opinions on this.
Here is the “Rental” paragraph that I’ve been using in regards to late fees in the “Residential Lease Agreement” I’ve been using.
The rent shall be $X per month, payable in advance of the 1st day of each month in the form of money order, cash of check payable to X. Residents shall pay first month’s rent prior to occupancy. If the Resident takes occupancy on a day other than the 1st, the rent shall be prorated on a daily basis and shall be paid prior to such occupancy. The prorated rent is $X per day. Considering the last month’s rent was not due at the time of move in, resident shall not use any portion of the deposit as final month’s rent. If the rent is not paid by the 5th day of the month or a check is returned as ‘NFS’, A LATE FEE OF $50.00 WILL BE ASSESSED AGAINST THE RESIDENT and the Resident agrees to pay said late charge simultaneously with the rent on all installments not paid by the due date. Payment by check is conditional and if check is not honored by the bank on the rent due date, a $10 per day fee will be assessed.
Question:
In regards to the $50 late fee, as I have it now, this is the total late fee that will be applied. It only will accrue on a monthly basis. My thinking is that, perhaps if there was a late fee applied on a weekly basis due to non-payment, perhaps it would incentive or place pressure on the tenant to pay the rent more urgently. In other words, I’m not sure if the one-time-per-month late fee is adequate. I have one tenant now that is late and we’ve sent them written notice that the $50 late fee will be applied. Problem is I get the feeling that this isn’t enough to get them to remit payment, and I would be more inclined to get an attorney involved if the damages (accumulated late fees) were more substantial.