Complete List of Tenant Fees

12 Replies

I'm trying to round up all the different types of fees a landlord could charge their residents. This isn't my favorite income idea but there is no doubt collecting fees is a way to prevent more costly mistakes. What's missing in my list?

  • Bounced/Retuned check
  • Parking – and auctioning off preferred stalls
  • Parking violation
  • Pet Fees and Pet Application Fee in lieu of deposit
  • Failure to clean pet waste
  • Tenant application fee
  • Late payments
  • Check cashing
  • Credit card processing
  • Tampering with smoke-CO2 detector
  • Non-compliance after an initial written notice
  • Smoking in restricted area

Hi Al,

Just remember, threatening all kinds of fees is also a way to have a unit sit vacant for a long time. I would also be sure to check the laws in your jurisdiction regarding some of your fees. I'm not sure how you can enforce a fee for "failure to clean pet waste" unless you have proof it was their pet. Also check cashing and credit card processing fees can get tricky since you're not a financial institution. If you're going to threaten all of these fees I would be sure to get a real estate/landlord attorney in your area to look over your voluminous contract before having a tenant sign it.

My suggestion would be to do a more thorough screening of tenants rather than threatening them with all kinds of financial penalties. 

Cheers!

Eric

@Eric Black  thank you. I'm a collector of strategies that landlords can use to increase their income and equity. I don't plan to use all the information I gather.

You're correct - fees irritate.

On the flip side, fees discourage tenants from doing things you don't want - like smoke detector tampering.

Oh BTW, some landlords grab DNA samples from their tenant's pets as a condition of tenancy. This way they can determine who the pet waste belongs to.

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@Al Williamson  Grabbing DNA from a pet to determine if the pet waste belongs to the tenants pet??? That seems extreme, and expensive, I'm not sure the fee to the tenant would justify the expense of running a DNA test. :-)

We have escalating fees for violation of the town party ordinance and a police citation.  I would add something in about  fees for municipal violations or something along those lines.  So if the town fines you then you can pass that fee to the offender.

How about a fee to deliver a pay or quit notice? It goes along with late payment charges, but a little different.

What about a fee for not reporting a maintenance issue in a timely manner?

Originally posted by @Al Williamson :

@Randy Johnston 

@Eric Black  

You might get a kick out of this TV news report of a dog friendly apartment complex collecting DNA samples from dogs to discourage lazy owners.

 Who would've thought. Though I have to admit that there are a lot of lazy pet owners out there who think it's someone else's job to clean up their pet's waste. I have two dogs and we always pick up after them . . . even late at night.

Spend some time on Google researching the psychological impact of fees.  It is literally true that most people perceive two $10 fees more negatively than a single $25 fee.  You don't want to have the repuation as the guy who will nickel-and-dime tenants to death.  Unlike most of your other revenue ideas, with fees you cannot seriously present what you are doing as "providing a service" or "helping tenants with a problem."

@Colleen F.  @Jason C.  thanks for your input. Greatly appreciate it because I was mentally tapped out.

@Richard C.  you're correct. Fees aren't a preferred way to grow net income, but they are a legitimate income booster that must be included for completeness. "Fees and Commissions" are one of my 12 categories of income strategies for landlords.

I particularly hate the luggage fees airlines charge. It has encouraged me to change my behavior (carry on only for me). But think about it, a plane with less luggage is cheaper to fly and maintain. The airlines profit from my changed behavior due to fee avoidance.

Banking on "fee avoidance" strategy can benefit landlords in the same way.

@Al Williamson  Here is my list!

FEES

Application Fee (to cover administrative costs)... common in most markets.

Move-In Fee (to cover administrative costs)... common in some markets, but not seen in others.

Pet Fee (for the privilege of keeping a pet)

Guest Fee (a per diem fee for the privilege of allowing a guest to stay past the customary guest period)

Notice Service Fee (cost of serving/posting/mailing legal notices related to rental agreement violations)

NonSufficient Funds Fee (cost of trying to process an NSF check)

Rent Late Fee (violation fee)

Utilities Late Fee (violation fee)

Unauthorized Pet Fee (violation fee)

Unauthorized Occupant Fee (violation fee)

Unauthorized Parking Fee (violation fee)

Unauthorized Modification Fee (violation fee) - modifying the structure of the property without written consent, includes changing out light fixtures and plumbing fixtures.

Unauthorized Installation Fee (violation fee) - includes installation of  telecommunications equipment on the property without written consent.

Smoking Fee (violation fee)

Smoke/CO Alarm Tampering Fee (violation fee)

Fire Suppression Equipment Tampering Fee (violation fee)

Door Lock/Window Lock Tampering Fee (violation fee)

Garbage Fee (violation fee for cleaning up and disposing of excess garbage)

HERE ARE SOME OTHER IDEAS:

Property Damage - charge as it occurs or as it is discovered.

Special Services - charge as they are provided. (This could include yard care, home cleaning service, laundry service, shopping service, transportation service, house sitting, pet care, etc.)

Laundry Use Fee - charged at the machine by coin slot or card slot.

Pool Use Fee

Gym Use Fee

Pet Run/Pet Area Use Fee

Dock Use/Boat Ramp Fee

Dwelling Unit Rent

Parking Space Rent

Garage Rent

Storage Room/Locker Rent

Community Room Rent (rent out space for special events)

Boat Slip Rent

Furniture Rent

Sports Equipment Rent

Transportation Equipment Rent

Good tenants don't have a problem with penalty type fees because they rarely see them.  I see "negative" fees as a way to both motivate trouble tenants into doing the right thing and also a way to compensate us for the time and hassle of having to give special attention to a particular tenant.

Here is a list of our fees:

-$50+$5/day late rent on the 4th

-$50 3 day demand posted on the 7th

-$50 demand for compliance - i.e. parking on the grass, trash in the yard, uncut grass, code violations from the city, unpaid water/sewer over 30 days late that we have to pay to keep the water on, etc.

-lease break fee equal to 2 months rent

In addition, we have non-penalty type fees that never cause trouble.

$25/month per pet rent

$40 app fee per person to lease

We have some tenants that pay the max possible in fees EVERY MONTH, which nets us up to 20%-30% more than the base rent amount.  Some give up and move, which is fine.  Some stay which is fine.  In all, these trouble cases only represent about 5% of our tenants, but they always take up 90% of our time.

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