Hypothetical Tenant Situation

[James Edmister]

This is one of those questions that popped in my head while I was driving home from work the other day. Here we go.

Say I have a tenant that, for the first time, pays rent 1-2 days late. After reading the 'late payment' section from the book on rental property investing, I know there should be a set late fee in the rental agreement and I should adhere to the rental agreement to prevent the tenant from taking advantage of me. For argument sake, let's say the late fee is $50 and the monthly rent is $1,000.

What if the tenant ignores or flat out refuses to pay the late fee? My first thought is to let it go, but next month the same thing happens. Only this time time it's 3 days late and they simply ignore the $150 late fee. Now I understand there are legal issues with the tenant refusing to pay the fee, but wouldn't it cost the owner more to pursue action against the tenant? This also becomes difficult if the tenant is in the beginning of a year lease. 

How do you enforce late fees if the tenant just ignores them and continually pays rent a few days late every month?

[Ned Carey]

Eviction. While you may feel it is trivial to go to court for $50. The tenant won't think it is trivial to lose their home. You train your tenant or your tenant trains you.