All About Rent Due Dates
Due Dates
Many tenants have difficulty with the concept of due dates for rent. If rent is due on the 1st and late by the 3rd, is it really due on the 3rd? Plenty of people will interpret it that way, so plenty of landlords deal with this issue by allowing no grace period—rent is due on the 1st and late on the 2nd. This policy, while rigid, eliminates a lot of headaches.
If a tenant moves in on the 10th of the month, some landlords elect to prorate the first month’s rent and have subsequent rent due on the 1st of each month. Other landlords would have the rent due on the 10th of each month.
Prorating
To charge a tenant rent for 15, 20, or 25 days of occupancy, just divide the rent by 30 to obtain a per-diem rental rate. (Use 30 days as standard.) Then multiply by the number of days left until the 1st of the following month, when the full rent is due. For a $1200 per month rent, the daily figure would be $40. A tenant moving in on the 10th owes 20 days rent, or $800.
Late Fees
Depending on your state, late fees for delinquent rent payments may or may not be allowed. Often laws allow “reasonable” late charges . How will you know if your late fee is “reasonable?” Often, you won’t know until a tenant complains.
Ask other landlords in your area about average late fees—or search around the internet and you’ll find plenty of opinions. Some landlords charge flat rates; others do percentages. A 5% late fee on $1200 rent is $60. That’s enough to keep some tenants right on time. A $25 flat fee might not be much incentive. Some landlords charge by the day, increasing it as the days tick by.
If you plan to charge your tenants a late fee, state it clearly in your lease. For example:
Rent is due on the 1st of each month, and is considered late on the 3rd. Beginning with the 3rd day of the month, a $10 per day late charge will be assessed. On the 11th day of the month, the per-day late fee increases to $25, and a pay or quit notice will be issued.
Grace Periods
States that regulate late fees also specify that they cannot be charged until after a 3, 5, 7, 10 or other number of days after the rent is due. Some states require you give notice that late fee will be charged. Check your local and state laws regarding grace periods.
Accepting Late Rent Payments
If you have tenants who consistently pay rent late, along with the fee, they could feel that the rent isn’t “really late.” You should let them know in writing that late rent is late rent, and you will report their late payments as such.
Waiving the Late Fee
Most landlords would tell you “don’t do it.” Not even once. But waiving a late fee, just like whether to charge one in the first place, is completely up to you—it’s your money, after all!
November 2nd, 2011 at
I have a tenant he always paid the rent on the 3rd day of the grace period. The rent is due on the first. My question is, does that mean on the 3rd day before midnight he legally can pay the rent? I always find the rental check under the door the next morning on the 4th day. What is the best way to handle this? Thank you.