#1 Risk of Waiving Late Fees

It can be hard to be the bad guy sometimes. As a landlord, you want to have a positive relationship with your tenants and make their housing experience as hassle-free as possible. But sometimes you are forced to enforce the policies that you outline in each lease. Maybe you hear a bark from unit A where you know a really nice tenant lives, but you know that this tenant definitely did not disclose Fido on their lease. Confronting your renter about these kinds of issues can be difficult.

The same goes for any tenant that pays rent late — you have a policy saying you will charge a late fee for any payment that is beyond the predetermined date. However, if Stacy from apartment 201 asks for a fee waiver after two years of consistent rent payments, should you give it to her?

Waiving One Fee Leads to Waiving More

The primary thing landlords need to consider when waiving fees is the age-old saying that if you give someone an inch, they take a mile. In the previous example with the nice tenant and their dog Fido, say you let it slide and tell this tenant that you will allow them to go without paying their pet fee. What happens when they then get Whiskers the cat? Or, if you let Stacy pay rent late this one time, she may feel like she can pay rent late again without any repercussions. It is important to keep in mind that renters who pay late are in breach of a legally binding contract. Charging late fees is just a consequence of doing so. You have these policies in place for a reason. Waiving fees left and right can be detrimental to your business not only in terms of lost income, but in other ways as well.

Don’t Play Favorites

Everyone hated that teacher in high school that let one student get away with everything and didn’t extend the same courtesy to the rest of their students.  Playing favorites is not only rude, but as a landlord, it’s also illegal. Fair housing laws prohibit a landlord from extending privileges to one tenant over another. That’s why it is ideal that you stick to the terms outlined in your lease. Both you and the renter agreed to the rules as they were laid out in that document, so it is simpler to maintain that agreement as it stands.

Sticking to the lease as it is written is also advantageous in the scenario that you waive one fee for a tenant, who then tells another that they can get the same treatment. Waiving fees is a slippery slope- granting one waiver greatly increases the chances that you will be persuaded into doing so again.

Being Consistent

However, if you do want to grant some leniency to your tenants, compromises are not completely out of the question. In the case that you do allow certain compromises on fees, you have to make sure that you are consistent on when, how, and who you waive them for. Maybe you consider a fee waiver after a tenant makes a certain number of timely, full, and consecutive payments. If every tenant has the possibility of earning this privilege, you can keep things fair while only rewarding the most reliable tenants.


The goal is to rarely have to enforce late fees in the first place. The main way to reduce late payments is to conduct rigorous tenant screening practices. Tenant screening is a way to vet your potential renters before they move into one of your properties. Using credit checks, finding rental history, and following up with past employers or landlords is a great way to tell if this potential renter has a habit of turning in payments past-due, or an unwillingness to follow the terms of their lease in general.

Final Thoughts

When you want to waive a fee for a reliable tenant, the key is to make sure you’re consistent . Write down a few compromises you will allow and when you will allow them, and include those in every rental agreement. Then, stick to that list. The last thing you would want is to be accused of partaking in housing discrimination.

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