Forgive a Late Fee Once, but Only Once

My lease is very strict regarding late fees.

I believe late fees are the “muscle” that encourage on-time rent payments. Ever since I moved to collecting online rent payments, I haven’t had a problem with late rent.

If my tenants miss the rent due date, their account is assigned a late fee of 5% automatically.

When this happens, I usually get an email from them saying they are “so sorry” and it will “never happen again”.

Most of the time, I forgive the late fee the first time, even though the lease does not require me to do so. Then I tell them that I will forgive the late fee “just this once”, and that next time they will have to pay the fee in full.

This usually builds a good relationship with them. If they are ever late again, I do enforce the late fee – which they are usually okay with at this point – because they’ve been warned (and know it).

The reality is that good tenants might slip up once, but bad tenants will constantly be late on rent. If they are a good tenant, they deserve a break. If they are bad tenants, you’re going to make a killing in late fees – so it’s not that big of a deal to forgive the first late fee.