Late Fees

Discussion in 'Business Operations' started by Lisk, Feb 28, 2006.

  1. Lisk

    Lisk LawnSite Member
    Posts: 33

    Just curious what some of you guys charge when a customers balance is past due? Finance charge or just a flat out late fee price? Thanks

    Steve
     
  2. cgrappler135

    cgrappler135 LawnSite Member
    Posts: 193

    we charge a 5% fee after 30 days
     
  3. Roger

    Roger LawnSite Fanatic
    Posts: 5,927

    I've seen many threads about adding late fees, but nobody ever says if they collect them.

    For those of you who add late fees, how many customers pay the fees, or just pay the base amount of the invoice? How far do you go, what steps do you take, to collect the late fees? Or, are you only using the late fee charge as a threat, with no expectation of ever getting the money?
     
  4. jrc lawncare

    jrc lawncare LawnSite Senior Member
    Posts: 420

    I had one client last year after repeated late charges being added, finally filed in small claims & got everything. Wasn't a lot...$500.00, but it was my money.
     
  5. nobagger

    nobagger LawnSite Gold Member
    from Pa
    Posts: 3,065

    We charge a 10% of total balance. And yes we collect them! I'm about to collect some this week for snow plow billing that went out 3 weeks ago. Our's is after 14 days no exceptions!:nono:
     
  6. jondcoleman

    jondcoleman LawnSite Member
    Posts: 181

    We charge $5.00 or 2% per month, depending on which is higher. As to not collecting them, we grossed about 150k last year and I just checked in quickbooks and we earned over $1000 in late fees last year. Agreed, some customers do not pay them (but it does cause them to pay their bill) but some do. We use CLIP Software and late fees are easy to keep track of so it is definetely worth it to us. I have heard stories of people buying CLIP Software and making up for the price of the software in late fees during the first year!

    Jon Coleman
    Maryland, USA
     
  7. BSDeality

    BSDeality LawnSite Silver Member
    Posts: 2,850

    you might want to consult an accountant/lawyer to see what is legal and what isn't. In CT it is limited to 12% per year or 1% per month... you can add a late charge fee however I believe.
     
  8. jrc lawncare

    jrc lawncare LawnSite Senior Member
    Posts: 420

    Very good advice. In NY, we can charge 2% monthly for a total of 24% over the year.
     
  9. scagwildcat

    scagwildcat LawnSite Senior Member
    from nw. ct.
    Posts: 507

    you might want to check on that, i just went to my lawyer yesterday, its 1.5% per 30 days 18% annum, and hes checking for a legal rate that i can charge for a flat fee....
     
  10. BSDeality

    BSDeality LawnSite Silver Member
    Posts: 2,850

    Damn! and to think I just recalculated late fees for two PITA's I've got. that extra .5% would make a couple hundred dollars difference. I got the 12% off a state website, guess our state doesn't like to update its own documentation online. I'll have to ask my accountant about that.
     

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