Does Your Landlord Give You an Incentive to Pay Rent on Time? - Mothering Forums
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#1 of 43 Old 03-28-2008, 12:15 AM - Thread Starter
 
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Hi-
We've suddenly been put in the position of being landlords to a rental house. Our plan is: if the tenants pay rent on time each month, come December, they only have to pay 1/2 of the month's rent.

What incentives does your landlord give you, if any?

TIA
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#2 of 43 Old 03-28-2008, 12:27 AM
 
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Sounds like a sweet deal to me. When I rented the incentive was to not have to pay more because of a late fee!
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#3 of 43 Old 03-28-2008, 12:28 AM
 
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When I was renting the 'incentive' was if you paid on time where was not a late fee. Basically anything after the 2nd was late and penalty and fee's started
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#4 of 43 Old 03-28-2008, 12:46 AM
 
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I think that the incentive to pay your rent (and/or on time) is so that you can live there. Some people are going to pay their rent every month. Some people are not. I don't think that an incentive to someone who may not find paying rent to be a priority is really going to change anything.
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#5 of 43 Old 03-28-2008, 01:02 AM
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It is a nice idea to use positive reinforcement rather than punishment but I have never heard of this before. I pay my rent on time to avoid a late fee.
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#6 of 43 Old 03-28-2008, 01:13 AM - Thread Starter
 
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Thanks for the feedback. I've read how some landlords give gift cards at the end of the year to tenants. We have rented before and never received any incentive either, but I sure would have welcomed one

How much of a late fee are you charged?
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#7 of 43 Old 03-28-2008, 01:30 AM
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I think the late fee is $30 a day starting day 4 of being late. We have a 3 day grace period.

At the holidays we did receive a gift box (think Harry and David type stuff). It was good but I didn't really like having extra sugar around the house.
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#8 of 43 Old 03-28-2008, 09:38 AM
 
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Originally Posted by lalaland42 View Post
I think the late fee is $30 a day starting day 4 of being late. We have a 3 day grace period.
Yikes, that's a scary late fee. If something happened unexpectatly (not just being irresponsible), it seems like it would be very difficult to get out from under that fee. Kind of reminds me of the overdraft charges banks charge and are difficult for people to pay off.

We don't pay rent really, but we do pay lot rent since we own our mobile home. Our late fee is a $1 per day. No late fee if paid by the 4th. I realize that is really low though. I don't think that would be good for a real rental.

To the OP, I've never heard of an incentive like that, but it sure would have been nice when we were renting.

I think I would come up with a reasonable late fee though.
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#9 of 43 Old 03-28-2008, 09:45 AM
 
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Our late fees have varied. The last place we rented was $50 for 3-6 days late, then $50/day for each day after that.
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#10 of 43 Old 03-28-2008, 11:49 AM
 
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ours is $50 late fee if not paid by the 5th, and additional late fee of $50 if not paid by the 15th

i think an incentive thing would be very cool.

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#11 of 43 Old 03-28-2008, 11:52 AM
 
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I had a landlord that gave a $25 or $50 incentive if you paid by the 4th. He said he did it this way because if you have to sue for back rent you can't get late fees, and this way he could get the full rent from people if he had to sue for back rent. I think he just upped the rent by the incentive amount.

I'm going to start offering my landlady an incentive to cash my rent checks sooner than 3 weeks after I pay her. It drives me crazy.
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#12 of 43 Old 03-28-2008, 11:58 AM
 
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Our late fee was like 12$ a day for lot rent when I lived in a MH in college. For our house, it was 25$ the first day and then like 5$ per day after. But I was on good terms with our MH ladlord and if I went down and said, "Hey XYZ came up, and I'm going to be 2 days late, whats the fee?" She'd say, no charge. We had a good history of paying every month, in full, without qualms which made us rare (And she knew my parents would cover me and had $$ in her mind - mom drove a very old used lexus). She was my fave landlady by far =) And knowing that if I had to be late, she'd waive it if I came to her first was quite the incentive in my college mind. Half off a month, particularly an expensive one, sounds like a GREAT incentive to me...Wish my mortgage company would give me half off my interest in Dec
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#13 of 43 Old 03-28-2008, 12:21 PM
 
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Our late fee is apparently $35. And you have to pay with money order or certified check if it's late (just read our lease agreement thingy).

We've always paid on time, although we have used the grace period when we're out of town - our management company *says* they'll hold postdated checks, but they don't so, we figure out if we'll be back in time; if not, we just move money from savings temporarily...We figure we end up having to use the SSRA, so, the landlord is going to have to scramble when we get orders, so we might as well be good tenants in the meantime.
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#14 of 43 Old 03-28-2008, 12:26 PM
 
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Ours if 50 per day if it's more than 3 days late. We've never been late on rent or mortgage but that's enough to keep us on time! I think a rent break in December is fabulous though!

Our landlord is a great guy though and I take our check to him personally each month just to keep a working relationship.
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#15 of 43 Old 03-28-2008, 12:30 PM
 
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I'm a landlord and don't have any incentives for paying on time.

1-9 days late = $35 late fee

10 days late = eviction notice.

I know that sounds harsh but if I don't get my rent on time I can't pay the mortgage and the bank takes my house.
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#16 of 43 Old 03-28-2008, 12:32 PM
 
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Ours is due by the 3rd (or is it the 5th? I usually pay before the first, so I always forget!) and after that, there's a late fee - I think it's $50. My brother lived at a place that gave a $50 discount if you paid before the 3rd. I've never heard of the 1/2 month off thing, but that would be a good incentive for me, having more money in the holiday season! half my rent would more than pay for xmas!
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#17 of 43 Old 03-28-2008, 12:34 PM
 
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Our rent is due here on the 1st, then late fees occur on the 6th. 30$, plus 4$each day, then after a certain amount of days, maybe 15 ? they add another 30$, plus start eviction notices and stuff. I 'm not quite sure here though, becuase we pay our rent 3-4months at a time.
An incentive would be nice, but really the incentive on paying on time , is that you continue to have a place to live, and you don't have to pay the fees.

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#18 of 43 Old 03-28-2008, 12:49 PM
 
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75 dollar late fee for rent not paid by the 4th... ( rent is due on the 1st but the late fees wont be calculated in til midnight on the 4th) boy were we pissed when they charge us that fee couple months ago. (our rent check was in the rent drop box on the 4th but they still charged us the fee.)
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#19 of 43 Old 03-28-2008, 12:58 PM
 
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No incentive, it's pretty much expected that adults pay their rent on time.
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#20 of 43 Old 03-28-2008, 02:15 PM
 
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Oh my goodness, I've never heard of such a thing.

Around here if you are late, you can get evicted. It's that simple.

Also, most places I've rented require post-dated cheques. If you are late your check bounces and that costs a bundle.

But I have to agree with the last poster: wouldn't any responsible person pay on time, regardless of bonuses or penalties?

I wouldn't rent to someone I thought needed an "incentive" to pay their bills on time...

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#21 of 43 Old 03-28-2008, 02:41 PM
 
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Our rent is due on the 5th of each month. However, if we pay on or before the 1st, we get to take $20 off the rent.

DH and I are good renters and have never paid a landlord late before, so we would always pay on time either way. But I have lived here for 3 years and have never paid after the 1st, so I have always saved the $20.

There is nothing in our lease about late fees- small town, we had excellent references, so perhaps he did not feel a need to include that in our lease.

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#22 of 43 Old 03-28-2008, 03:00 PM
 
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We have a $25 late fee if not paid by the 5th. But our house is owned by the paretns of friends. If we were ever not able to pay I think they'd work with us. They send us a $50 GC at Christmas.
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#23 of 43 Old 03-28-2008, 06:38 PM
 
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No, we get nothing but a place to live and no late fee for paying on time! They just started an automatic monthly draft that you could sign up for, and I was thinking there would be an incentive for that, but nope. We signed up for it though just because it saved us from driving 30 minutes to the office every month to give them a check. Could that be an option for you? At least you would know you would be getting it.

Will you also have late fees if they don't pay on time? I would be afraid people wouldnt be scared to pay late without them. They might just think "Oh well, we wont get that 1/2 off but it doesnt really hurt us now. "

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#24 of 43 Old 03-28-2008, 07:21 PM
 
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I have never gotten that type of 1/2 off the month's rent for paying on time.. wouldn't it be grand! Where is the property you're renting, I may decide to move.
I rented an apt. in a complex that is normal $859 a month... there was a special deal of $730 a month if I signed a one year lease, think seasonal renters, however if I am later than the 3rd, I think.. then the regular monthly rate will be charged for that month.
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#25 of 43 Old 03-28-2008, 07:53 PM
 
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Honestly, (as a current landlord and former tenant of many years), I think it is a bad idea. It is a nice idea, but I think it would end up being a hassle. We currently have great tenants who are 90% on time and we have actually never charged the late fee when they have needed an extra few days to come up with the rent. That's our "bonus" to them...not penalizing them if they truly need a little extra time.

IMO, what you are saying by offering an incentive for paying on time, is that you don't really expect to be paid on time. It is so rare and suprising that that you are paid on time that you are offering a bonus for the unusual tenants that do so.

I think it gives tacit approval to being late with the rent and you will find yourself just getting rent late almost every month. People tend to be more motivated by losing money that they have than by losing money that they might have had.

Now, that being said, as a formerly super-responsible tenant, I would have loved to have something like this.

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#26 of 43 Old 03-28-2008, 08:42 PM
 
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Current landlord, current tennant here:

Think about this if they are late on the 2nd month, they will be late on all subsequent months, because the incentive is an "all or nothing" deal.

Best to keep it at late fees and leave it at that. You could even structure it so that december is 1/2 off and say "that is just our annual thank-you for renting with us."

----------

Quote:
Originally Posted by fek&fuzz View Post
I'm going to start offering my landlady an incentive to cash my rent checks sooner than 3 weeks after I pay her. It drives me crazy.
Pay with money orders, it is worth it to us to pay 50 cents extra to ensure that money leaves our account when it is supposed to. We have not written checks for like 7 years, but the few times we did write checks back then, we had a necro check come back and cause is to go into negative after we had written it off... check was cashed 89 days after we write it. We assumed it would never be cashed, or that we made a mistake in the registry. 900-1000 dollars in hot check court fees/fines... we will never spend that much on Money order fees even if we wrote 2 every month till the day we die, so we consider it money well spent.
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#27 of 43 Old 03-28-2008, 08:55 PM
 
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From a renter: Charge late fees and get your tenants a box of chocolates or a fruit basket at the end of the year. Although I've never been late paying rent, a gift just feels better to me.

me, 28 & dh, 32.
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#28 of 43 Old 03-28-2008, 09:58 PM
 
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Quote:
Originally Posted by mrs_oli View Post
Hi-
We've suddenly been put in the position of being landlords to a rental house. Our plan is: if the tenants pay rent on time each month, come December, they only have to pay 1/2 of the month's rent.

What incentives does your landlord give you, if any?

TIA

Not to evict us

Heidi
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#29 of 43 Old 03-28-2008, 10:04 PM
 
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Landlord here!

If its at all helpful, our rental agreement has the following clauses:

Quote:
Clause 5. Payment of Rent
Regular monthly rent
Tenant will pay to Landlord a monthly rent of $XXX, payable in advance on the first day of each month, except when that day falls on a weekend or legal holiday, in which case rent is due on the next business day.

Clause 6. Late Charges
If Tenant fails to pay the rent in full before the end of the third day after it's due, and no prior arrangement has been made, Tenant will pay Landlord a late charge of $10, plus $5 for each additional day that the rent remains unpaid. The total late charge for any one month will not exceed $45. Landlord does not waive the right to insist on payment of the rent in full on the date it is due.
Honestly, I think there have been some great points made against the idea.

Now, having said that, I totally understand the motivation behind the idea. Our rental apartment is one of a gazillion available in this town and we have a very strong desire to RETAIN tenants. One way we have tried to do that is to give a gift certificate for 1/2 off One Month's Rent each Christmas, along with a small, actual gift. This has gone over very well. Our tenant can use the GC anytime throughout the year and I think it has really helped us stay attractive to them and competitive with other rentals that available.

ETA: I also highly, highly recommend Nolo's Every Landlord's Legal Guide. It has helped us immensely through the years.
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#30 of 43 Old 03-28-2008, 10:32 PM
 
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I wouldn't make any promises like this. It's a nice idea, but what if taxes/utilities/etc. go up, and missing 1/2 month's rent would be a real pinch? If at some point you had to stop doing this, there will be a lot of grumbling. I can also see some tenants trying to negotiate - but I was only late ONE month, and it was my cousin's daughter's wedding...

Assess late fees for late payment, figure out what your rights are as landlords in your state/city, and make sure you have a good lease.

Now, I did have one family of exceptional tenants - when I was selling the 2 family house (they had a lease so were able to stay on w/the new owners), they were so gracious about letting it be shown, the place was always immaculate, they let me know ASAP if something went wrong, and they were just generally a pleasure. At Christmas I gave them a gift card to the local coffee shop, and gave them a gift card to something else before I sold as a token. At times I gave occasional gifts to other tenants who were nice, responsible, etc.

But, I wouldn't advise promising anything like that upfront.
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