Do you charge a late pay fee ?

Discussion in 'Starting a Lawn Care Business' started by gardiner, Apr 17, 2008.

  1. gardiner

    gardiner LawnSite Member
    Posts: 171

    This is my first season in and i like to give a big thanks for the knowledge i gain on the forums i have a question is it illegal to charge a late pay fee to clients for mowing in ohio ? I try to find out looking online and i came up with nothing . I tryed to make some kind of contract just incase one is needed havent used any as of yet . Or better yet what your policy on slow / non pay clients. I know there out there and most have been stiffed one time or another . Here a piece what i got on the contract i made up
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    Customer shall pay to Contractor at the rate of $ _________per service call for the service herein agreed to be performed. Contractor will bill Customer and Customer shall make payment within 20 days of billing date. Contractor submits bills to Customer on the 15th of each month. Contractor will not bill Customer in advance for services performed. Customer agrees to contact Contractor within 5 days after due date to make arrangements or late fee of 2% per day will apply for all balances not made when due, not to exceed 15 days. Thereafter contract will be terminated. If balance is not paid within 30 days of contract termination, collection fees will be applied to balance. Returned Checks subject to a $25.00 Return Check Fee
     
  2. bohiaa

    bohiaa LawnSite Fanatic
    Posts: 5,220

    No it's NOT....

    However your gonna have to change your way of thinking....

    your statement is " is it illegal to charge a late pay fee to clients for mowing in ohio "

    the correct statement is, is it illegal to charge interest for late payment..

    doesn't matter what the payment is for, Just make sure you have something sgined by the customer saying that there gonna pay you "X" to do "Y" then you can start charging interest, late fees, collection fees and such...

    If you dont have this and you turn it over to collections you may be sued...

    Good luck
     
  3. gardiner

    gardiner LawnSite Member
    Posts: 171

    Customer agrees to contact Contractor within 5 days after due date to make arrangements or interest fee of 2% per day will apply for all balances not made when due, not to exceed 15 days. Thereafter contract will be terminated.

    sound better ?

    i try to watch for people who cant purchase my product or service . I find it kinda hard to do being my first year . i thinking if i turn one away i could of lost one of the best stops there is
    what do you call those people that lives like a low class but is loaded
    you know there people out there that just dont like moving and been in same area for over 30 yrs and area been on a down side.
    thanks for the reply
     
  4. ed2hess

    ed2hess LawnSite Fanatic
    Posts: 12,960

    All that is way too complicated ....late payers aren't going to be influenced by anything you write on that contract. Many of the billing invoice software have inducement letters that go out when stuff gets beyond 30 days. Our bottom line is we will carry them along telling them they owe but in Dec we turn it over to laywer and one letter gets the money. And surprising we don't lose many that way...
     
  5. GreenthumbGA

    GreenthumbGA LawnSite Member
    Posts: 191

    we charge a ten dollar late fee fifteen days after invoice date. 30 days cancels the contract and a cancelation fee is applied(one months contract fee) plus what is owed. 60 days goes to collections.....period.
     
  6. Turfrific

    Turfrific LawnSite Member
    Posts: 179

    is dave thomas wendys?
     
  7. gardiner

    gardiner LawnSite Member
    Posts: 171

    thought i was bad you ain't playen are you :weightlifter:

    you only give them 15 days. where if you send out invoice on 15th it owed by the 30th.. i have noticed most of the lawns i do are retired elder folk . on that i was thinking that most don't get paid till around the 1st of the month so i took it to 20 days to give them 5 days into the following month thinking i would revive there payment before the 5th of each month and if still no pay by the 20th day contract will be terminated. i don't know much about collections but the wife worked at a collections office and you know how a woman can be ( no offence if any ladies on here )
     
  8. John Gamba

    John Gamba LawnSite Fanatic
    from ct
    Posts: 10,812

    A friend that i helped get into this business avoids all of this by getting a credit check before he starts work.it will not solve all the problems you can have but it does help.
     
  9. gardiner

    gardiner LawnSite Member
    Posts: 171

    WOW ... hopefully it gets easier as time goes by .. i been so busy tryen to get things set up.. maken up the service quotes and contracts and calls coming in going and looking at places and hearing someone can do it cheaper . and yesterday one guy told me a company that been around as long as i can remember can come mow his lawn for 10 bucks cheaper when i know there overhead is alot higher then mine. and then tell me he can get mulched delerivered for like 13.50 a yard i have a station not 5 min away from me that that makes the mulch and i payen 15.50 a yard @ contracter price. boy my head been running like a freight train on that i have to say to all that been where i at good job
     
  10. John Gamba

    John Gamba LawnSite Fanatic
    from ct
    Posts: 10,812


    When people talk like that, Start walking away.
     

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