How aggressive is your late payment penalty?
Opinions vary on this subject. In my practice I have learned to keep the late fees relatively low.
Let me explain. I do NOT any make exceptions for anyone. That said, one thing I know for sure I won’t be in trouble with the Fair Housing laws treating people differently.
Now, with the no exception policy I do not want to put myself in a position to evict a good tenant just because he/she fell behind one month and the late fees are so hefty that cannot afford to pay. I keep the late fees low enough to “sting” a bit, just like your mortgage late fee, but nonetheless affordable. For those repetitive offenders, my lease has a provision for eviction.
I provide the tenants many ways to pay. They include:
- postal mail
- drop off by the front desk and obtain a receipt
- the drop off box outside of the building
- and for those last minute payments online through my website