Are you a leasing agent in Houston? Know how Houston Landlords Handle Late Fees

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As much as we would like tenants to pay on time, unfortunate events can cause them to delay payment. If it only happens once or twice, the landlord does not have to worry. If it becomes a habit, that’s where we’re going to have a problem. Thankfully, there are ways to regulate the tenants and avoid late rent.

Most landlords, if not all, include the policy of paying late fees if the tenant fails to settle their rent on time. And Houston landlords are not an exception. The purpose of having this rule is to discourage delays and not as an additional income for landlords. They would still prefer on-time payment than having to ask for late fees all the time.

Late fees may differ from state to state because of the laws available in the area. A few years ago in Houston, the law limited how landlords charge them. It depended on the damages caused by the late payment. Because of this, the landlords had a hard time determining the amount for late fees. It became difficult for them to prove the extent of some damages.

However, last September 2019, Senate Bill 1414 was implemented. The landlords can charge up to 10% of the monthly rent for apartments and 12% for a single-family house. They also do not have to justify anything and can charge for direct and indirect costs. For example, if the rent for an apartment is $1,200, the landlord can charge up to $120 per late payment.

• Why tenants are worried

Before the release of SB 1414, the landlord would charge a specific amount if the tenant paid three days after the due date. And an additional amount for the next few days. As mentioned above, the landlords had to present a proper justification if they will charge late fees.

With Sb 1414, the landlord can charge the maximum amount for late fees. The tenants worry that some landlords may take advantage of it. But we have to remind landlords to remain fair, and charging too much might cause them to lose tenants.

Not everyone can afford to pay late fees. The fact that they could not settle the payment on time means they have problems with money. We want to encourage them to give the amount within the due date and not find another rental. Here are other ways to handle late payments.

  1. The landlord should know about charging the tenants reasonably. He can still get in trouble if the court finds the fees excessive. They can ask for enough late payment to make the tenant realize its significance.
  2. Sometimes the tenants are going through a financial crisis that the landlords do not know. Before he decides on charging them a late fee, he can ask why they did not settle their payment. Some tenants get their salary on a different day of the month, which might be days after the rent is due. They can compromise on an alternative due date to accommodate the tenant’s concern. 
  3. The landlord should give the tenants a few days to pay their rent or called a grace period. For example, the landlord will not charge a late fee if the tenant pays two days after the due date. The tenants will appreciate the consideration given to them.
  4. Tenants will give every excuse imaginable to avoid paying the late fees. The landlord should be firm in instigating the policy on late payments because if he wavers, the tenant might take advantage. If they do have a valid reason, the landlord can offer to let them pay in installments.

Sometimes the landlord has to be considerate of their tenant’s situation. Late payments do not always mean they have bad renters. Unfortunate events can happen to anyone, and we have to remember that. If the landlord can learn to handle these issues, the tenants will likely extend their lease. They might also help him find occupants for his other properties.

But you can cover that last part already. Once you sign up for Padleads, you can post the property listing online for people to see. You can even syndicate it to other websites. You can guarantee them a beautiful property and a landlord who manages well.

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