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Late Fees..

Discussion in 'Business Operations' started by esshaki, Jan 6, 2006.

  1. esshaki

    esshaki LawnSite Member
    Posts: 100

    Just wondering what other guys charge for a late fee. Im in michigan and i charge a $25.00 late fee, if the payment is not in my hands by the given date, was wondering if i am charging a high late fee. If everyone could share their late fee's that would be nice.
  2. shiveslandcsaping

    shiveslandcsaping LawnSite Member
    Posts: 93

    I charge 10% compounded daily after due date. If its 10 days late I make double. I am sure there wont be to many late ones LOL.
  3. work_it

    work_it LawnSite Senior Member
    Posts: 976

    I only have a couple habitual late payers, but early last year (May) I had a situation where over half my accounts were 10 to 15 days late. It ended up costing me a couple hundred $$$ since I couldn't pay my bills on time. I charged every late account $25 and included a memo with my next months invoices. The memo clearly stated a change in my late fees which are now $25 if payment isn't received by due date, and $25 billed every 15th day after due date. After that I didn't have but a couple problems the rest of the year with customers paying late.
  4. mtdman

    mtdman LawnSite Gold Member
    Posts: 3,137

    My late fee after the 15th is $10. However, I was told by a lawyer that you cannot charge late fees in Michigan legally until it is 30 days PAST DUE. Not just past the due date. I rarely have late payers, so I don't usually worry about it. And most of the time the people were gone and forgot to tell me, and I knock off the fee.
  5. work_it

    work_it LawnSite Senior Member
    Posts: 976

    Yea right...try to tell that to the gas, electric, phone, cable, credit card, and mortgage companies. I'm sure the list goes on, but the fact is that they don't wait 30 days. If that's the case then I would start billing one month in advance...which I've already considered doing.
  6. tiedeman

    tiedeman LawnSite Fanatic
    from earth
    Posts: 8,745

    you know what Tom, I tried that late fee on customer before that was 26 days past due, and they tried the whole 30 day thing as well
  7. crzymow

    crzymow LawnSite Senior Member
    from Pa
    Posts: 378

    most of my customers i dont have a problem with. I am thinking this year that the customers i have had problems with i will start charging them in advance, if they dont like it, they can find someone else.
  8. work_it

    work_it LawnSite Senior Member
    Posts: 976

    One of my customers went past the 45 day mark after the notices went out. I had no problem billing them the extra $75. Sent the invoice in the form of a certified letter stating that they had 7 days to pay before meeting me in claims court. And yes, their service was cancelled...effective immediately.
  9. dcondon

    dcondon LawnSite Silver Member
    Posts: 2,246

    In this area, all you would do is deal with late fees. People always pay but may be a little late. Not much money in these area, we just deal with it and move on.
  10. Lawnmasters

    Lawnmasters LawnSite Member
    Posts: 180

    WOW ! $25.00 late fee? I can't think of many of my customer's who wouldnt call me up and tell me to not come to their place anymore. I charge like most of the trade accounts charge. The typical 2% of the balance or a minimum $5.00 Maybe I should give it a shot though, my customers are pretty good though, but a few are always late, I just think of them as my savings account. They pay eventually.

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