Renter Refuses To Pay Late Fee, But Pays Rent

Investor · Medford, MA · Member since 2017 · 56 posts · 27 votes

Hypothetical Question.

You have a renter and they are late with a payment. You charge them a late fee, but the next month, rent shows up on time but no added late fee. What do you do?

Is it worth evicting someone over a late fee? Where's your line in the sand?

0 Reply

43 views

Most Popular Reply

Kim Meredith HamptonBusiness Member

Real Estate Broker · St Petersburg · Member since 2014 · 2k+ posts · 2k+ votes

Ryan,

Give him the payment back and let him know you don't accept partial payments! He will get the jest of your point

[email protected]407-448-6679 Podcast Guest on Show The Key to Scoring Discounted Deals in One of America’s Hottest Markets

Compass | St. Pete514 Reviews

Website View Page

6 Reply

See this reply in the discussion

22 Replies

Jump to latestLatest

Sort by

Kim Meredith HamptonBusiness Member
Real Estate Broker · St Petersburg · Member since 2014 · 2k+ posts · 2k+ votes
9y
Ryan,
Give him the payment back and let him know you don't accept partial payments! He will get the jest of your point
[email protected]407-448-6679 Podcast Guest on Show The Key to Scoring Discounted Deals in One of America’s Hottest Markets
Compass | St. Pete514 Reviews
Website View Page
6 Reply
Joe SplitrockPro Member
Moderator
Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes
9y
@Ryan M. the late fee needs to be paid with late rent, not paid the following month. I wouldn't just explain that the late fee must be paid. I have never had someone refuse to pay it, but my guess is a person like that will be trouble.
0 Reply
Ryan M.
OP
Investor · Medford, MA · Member since 2017 · 56 posts · 27 votes
9y
@Joe Splitrock Ahhhhh gotcha. Makes sense to me now. I was thinking they pay the late fee the following month.
0 Reply
Michael J.
Rental Property Investor · Louisville, KY · Member since 2008 · 342 posts · 123 votes
9y
My lease states any fees or costs I incur that they owe are taken from their payment first and then the balance applied to rent, so they would basically end up owing me $50 in rent or what ever the late fee is. Then they would get a pay or quit notice if they don't pay the balance of rent owed. It would be due the day after the rent is late. State laws may vary.
6 Reply
Ray Harrell
Investor · Chicago, IL · Member since 2016 · 1k+ posts · 930 votes
9y
How long has the tenant been in place? How many times has he been late? If for some reason I was late on my rent, I would refuse to pay a late fee also after 5 years of on-time rent.
1 Reply
Jenifer Kynor
Fort Collins, CO · Member since 2017 · 273 posts · 91 votes
9y
At my apartment complex, there is one freebie with late rent. Sometimes things come up. However, if the tenant is continuously late on rent, only accept the payment in full, with the late fee's included.
With my lease, it is a $50 late fee, and $10 additional for each day and they only accept the rent payment in full. I would never want to pay late with the fees being so harsh!
0 Reply
Marian Smith
Real Estate Investor · Williamson County, TX · Member since 2011 · 1k+ posts · 961 votes
9y
My lease in a 50 unit apartment in Boston did not have a late fee. I think in some areas it is illegal. I believe Texas allows late fees to the extent that the landlord is damaged...which may be why the PM keeps it (PM charges landlord extra if they have to spend resources tracking down rents so the charge is the damages). So maybe your tenant is from somewhere that doesn't allow late fees and feels it is unethical. A$50 late fee is like a 300% annual interest rate on $1200 rent. I include a late fee on my leases but give enough free passes that it probably isn't enforceable. I seem to always have one tenant that is fairly frequently late but I only have 4 properties, so one I can live with it. I am also not harmed because the deposit on the property allows me to make any mortgage payment on time...and my tenants have said, "You've been good to us with the late payments," when they have offered to repair small things, etc, so I know they do not take it for granted.
0 Reply
Richard Beatty
Boston, MA · Member since 2012 · 100 posts · 54 votes
9y
Under Massachusetts law, late fees, including interest on late rent, may not be imposed until the rent is 30 days late.
2 Reply
Rich N.Pro Member
Investor · Haverhill, MA · Member since 2015 · 761 posts · 328 votes
9y
To me, a late fee is not worth it in Massachusetts. you can not assess it until after 30 days. I go with a 14 day notice and move with eviction if they do not make the 14 days.
Its better to get the tenant trained its your way, not their way.
1 Reply
Thomas S.
Member since 2016 · 13k+ posts · 12k+ votes
9y
It is best to serve notice when a tenant does not pay all monies owed. If you do not you should re-write your lease and remove the late fees.
Any part of a lease that is not strictly enforced should be considered null and void.
0 Reply
Mike HurneyPro Member
Real Estate Investor · Boston, MA · Member since 2009 · 2k+ posts · 542 votes
9y
@Ray Harrell "I would refuse to pay a late fee also after 5 years of on-time rent."
To experienced Landlords that's a red flag!
0 Reply
Mike HurneyPro Member
Real Estate Investor · Boston, MA · Member since 2009 · 2k+ posts · 542 votes
9y
@Richard Beatty one of our members challenged the Housing Court Judge because his Lease states that for every day beyond the 5th day it's a $1. increase at the annual renewal (beyond his annual 1% increase). They can pay early and reduce it from the late days.
Judge agreed it's legal.
Landlord said it works great! Good Luck;-)
& @Rich N.
1 Reply
Ray Harrell
Investor · Chicago, IL · Member since 2016 · 1k+ posts · 930 votes
8y
@Mike Hurney, what's the red flag if it only happens once? If it happened once, then twice, then again, THAT could be a warning flag. When I was there for just over a year something happened to my payment and the PM called and wondered if I was ok, because my payment is always on time. 5 years later, still never late. If for some reason something happened and it didn't arrive on time, I would be insulted if they assessed a late fee.
1 Reply
Thomas S.
Member since 2016 · 13k+ posts · 12k+ votes
8y
The late payment was not the red flag it is the supposedly good tenants refusal to pay the late fee. If the tenant and landlord have had a good relationship for 5 years the tenant should have enough respect for that relationship and the landlord to pay monies owed without question. The refusal to pay is a resounding message to the landlord that the tenant has zero respect for that landlord after 5 years of tenancy.
That landlord had best smell the coffee and wake up to the fact that there is in fact no relationship with his tenant. When push comes to shove his tenant will screw him in a heartbeat.
That 5 year good tenant is of zero value and believe it or not is representative of every tenant out there. Landlords believe they have a "good" tenant only because their tenant has never been tested. Once tested landlords quickly discover that no tenant has loyalty or respect for any landlords.
0 Reply
Ray Harrell
Investor · Chicago, IL · Member since 2016 · 1k+ posts · 930 votes
8y
@Thomas S., I think you are stretching it quite a bit. Tenants are not dividend payments that you sit by and passively wait. They are people who have various payment methods, issues, job situations, etc. I would hope my landlord would respect the fact that I cause almost ZERO issues, and have the decency to inquire if for some reason my payment was late, AND even waive the late payment if it happens infrequently.
Furthermore, I'm not marrying my landlord, so we don't need to be emotionally attached to the point of "relationship" beyond a business agreement.
I think it speaks more to you and your attitude as a landlord that you would even consider charging a late fee for a 5-year, issue-free tenant who has never been late.
1 Reply
Thomas S.
Member since 2016 · 13k+ posts · 12k+ votes
8y
@Ray Harrell
Your landlord should have the decency to understand your situation in requesting to make a late payment and of course allow it. In return you should have the decency to respect that you have a binding legal contract and that, assuming late payment fees are included, you have the decency to respect that contract without expecting any special treatment.
You are correct in noting that there is no relationship outside of a business agreement between landlord and tenant. If there is it is clearly outside the landlord tenant relationship.
To use another example, a individual faithfully paying their utility bill for 5 years on time without fail and then one month they are late, a late fee will be automatically imposed. The normal individual would of course pay without question recognising the fee is legally imposed regardless of the reason for the late payment or the impeccable 5 year previous payment record.
If they refused to pay the late fee they would be an A hole, correct.
By waving a late fee for good tenants you are intimating that you would not waving the fee for bad tenants. Have you ever heard of the word discrimination.
As a landlord I do not have a "attitude" I have a business. If more landlords adhered to stricter businesses practices fewer would be posting on here for help to basic landlord tenant issues.
0 Reply
Sam Shueh
Real Estate Agent · Cupertino, CA · Member since 2016 · 4k+ posts · 1k+ votes
8y
If you are not kind and want to be an *** hole you can reinforce slight tardy fine and wonder why each year you have vacancy and no one wants to stay after 1st year.
People get paid differently and you need to work with them modify your agreements.
1 Reply
Karen Rittenhouse
Flipper/Rehabber · Greensboro, NC · Member since 2010 · 623 posts · 615 votes
8y
Another problem here - if you don't enforce, you've set precedent. Don't know how many rental you have, but you must treat them all the same or you're guilty of discrimination. Explain that to your tenant because its the truth, if you allow him to ignore late fees, you can't ask for them from anyone.
Good luck!
1 Reply
Mike HurneyPro Member
Real Estate Investor · Boston, MA · Member since 2009 · 2k+ posts · 542 votes
8y
@Ray Harrell What happens when you're late on your cc payment? and other bills? should they kiss your butt like you're expecting your Landlord to do?
0 Reply
Ray Harrell
Investor · Chicago, IL · Member since 2016 · 1k+ posts · 930 votes
8y
@Mike Hurney, I don't think it's asking them to kiss butt. I think it's providing customer service. Most credit cards and utilities have a grace period for "I forgot one time in the whole year", or mail issues. Almost every place I've called about unexpected fees will review your history and waive it, including banks.
I had one credit card where my payment was sent electronically 3 days before the due date, but didn't post until one day after. They charged a late fee. I called and asked for it to be waived and they said no. So I took money out of my savings and paid it off. Won't use that card again. Bad customer service.
If a landlord is ******* enough to enforce a late fee on someone who has been renting for 5 years and has never been late, he doesn't deserve tenants. Or rather, he deserves all the bad tenants he will attract. As I mentioned before, I was one year in my current place and a payment didn't arrive, and the PM called me to check on my well being FIRST, and when I offered to send another payment without knowing what happened to the first one, she said, no I'm sure it's lost, let's just wait. Post Office returned it to my bank for some odd reason.
You have to get a feel for your tenants. If they are problems from the beginning, then by all means, charge them everything you said you would. If they are problem free and all of a sudden a payment is late or missing, find out what the issue is. Maybe they genuinely forgot. Maybe it got lost, Maybe someone died and they just didn't think about it.
1 Reply
Mike HurneyPro Member
Real Estate Investor · Boston, MA · Member since 2009 · 2k+ posts · 542 votes
8y
@Ray Harrell I think we've both dug in.
Let's move on...
Where do you see yourself 10/3/2018?
I've been visiting Puerto Rico and was about to purchase some property. All my shots are up to date Hep A, Typhoid. Infectious disease MD says no Malaria there, Zeka is no problem for me but take plenty of Deet because Denghai is common (and no cure or immunity yet for it yet:-(
The Conference for next week has been cancelled, JetBlue cancelled all my flights, no rooms available at the hotels and my contacts say, Do not come down here now:-(
So I'll continue to upgrade my rentals with improvements my Tenants want and will pay more for and my days in PR will come! ;-)
0 Reply
Wil Reichard
Rental Property Investor · Greenville, SC · Member since 2017 · 185 posts · 178 votes
8y
I would take it out of their security deposit if it was a one time thing and they wernt cooperating. I like @Kim Meredith Hampton's idea though!
1 Reply

Join the conversationCreate a free account to reply, vote on answers and follow this thread.