How Should I Best Assess Late Fees For My Rentals?

How Should I Best Assess Late Fees For My Rentals?

How best to assess late fees for rentals is the question this week for Ask Landlord Hank. Remember Hank is not an attorney and he is not offering legal advice. If you have a question for him please fill out the form below.

Dear Landlord Hank:

When I am assessing a late fee, can I charge a one-time late fee of $250, or can I only charge 5 percent of the rent as a one-time late fee?

I understand if I charge a daily late fee, it cannot exceed 5 percent a day. Thank you

– Yvonne

Hello Landlady Yvonne,

I don’t know what state you are in, as many states address this subject and you must comply, but the late fee amount, when it is applied, and daily late-fee policies should all be very clear in your lease.

You must abide by those guidelines. If those issues weren’t addressed in your lease, you have no right to collect a late fee or daily late fee. Here in Florida, I charge a standard late fee of $100, no matter the rent of the property. I always reach out to a tenant, if they normally pay in a timely way, to tell them that the late fee will be applied if rent is not received by deadline, in the lease.

We try to have all our tenants pay by electronic funds transfer so the mail is not an excuse for tardiness.

Sincerely,

Hank Rossi

How Should I Best Assess Late Fees For My Rentals?
Landlord Hank says, “I charge a standard late fee of $100, no matter the rent of the property.”

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I started in real estate as a child watching my father take care of our family rentals- maintenance, tenant relations, etc , in small town Ohio. As I grew, I was occasionally Dad’s assistant. In the mid-90s I decided to get into the rental business on my own, as a sideline. In 2001, I retired from my profession and only managed my own investments, for the next 10 years. Six years ago, my sister, working as a rental agent/property manager in Sarasota, Florida convinced me to try the Florida lifestyle. I gave it a try and never looked back. A few years ago we started our own real estate brokerage. We focus on property management and leasing. I continue to manage my real estate portfolio here in Florida and Atlanta.