You can configure late fee (for leases located in the United States) or penalty interest (for leases located outside the United States) calculation details for an individual lease.
The optional parameter, OptCommCombinedLateFee.pkg, allows you to apply a combined late fee setup that specifies two different calculation types to determine how the system calculates late fees. This optional parameter is disabled by default in the system.
Late fee and penalty interest types are configured on the Late Fee Type Configuration screen. For more information, see .
To configure a late fee or penalty interest amount
Open the lease that you want to configure a late fee or penalty interest amount for. The [Tenant name] screen appears.
Open the Payment Terms section.
Click the Edit button
in the Late Fee/Penalty Interest field. The Edit Late Fee/Penalty Interest screen appears.
Complete the fields. Additional fields appear depending on the selected calculation type. For more information, see the Edit Late Fee/Penalty Interest Screen Reference table below.
Click Save.
Edit Late Fee/Penalty Interest screen reference
Calculation Type | How the system uses the Percent or Amount value in calculating the late fee. When the optional parameter, OptCommCombinedLateFee.pkg, is not enabled, the following options appear for leases located in the United States:
When the optional parameter, OptCommCombinedLateFee.pkg, is not enabled, the following options appear for international leases:
All options above appear for both leases located in the United States and international leases when the optional parameter, OptCommCombinedLateFee.pkg, is enabled. In addition, the Flat Amount-Month option—a flat amount late fee applied to only the current month's outstanding charges—appears only when the optional parameter is enabled. |
Percent Net/Gross | Appears for all calculation types except for: Interest Index and Interest Index - Days, Flat Amount, Flat Amount-Month. A fixed percent value for the penalty interest rate. |
Amount | Appears only when the Flat Amount and Flat Amount-Month calculation types are selected. The amount of the late fee. |
Interest Index Net/Gross | Appears only when the Interest Index calculation type is selected. The interest index for the penalty interest percentage value used in the late fee calculation. |
Index Factor | Appears only when the Interest Index and Interest Index (Days) calculation types are selected. The system multiplies the interest index value by the Factor value to obtain the penalty interest percentage rate. A Factor value of 1 would have no effect. The factor is applied before the Min/Max Percentage test. |
Index Adjustment | Appears only when the Interest Index and Interest Index (Days) calculation types are selected. The system adds the Adjustment value to the Interest Index value to obtain the penalty interest percentage rate. |
Additional Fee | The system adds this fee to the calculated late fee. NOTE: The Additional Fee is added prior to the min/max threshold check. |
Include Unpaid Charges | Appears only when the Percentage of Charge, Percentage of Charge (Months), and Fixed Interest calculation types are selected. If this field is selected, late fees are charged on unpaid charges. If it is not selected, late fees are charged only on receipted amounts. |
Min Percent | Appears only when the Interest Index and Interest Index (Days) calculation types are selected. If the interest index value is lower than this value, the system uses this value instead. |
Max Percent | Appears only when the Interest Index and Interest Index (Days) calculation types are selected. If the interest index value is higher than this value, the system uses this value instead. |
Min Fee | Minimum late fee amount for combined original and second late fees. |
Max Fee | Maximum late fee amount for combined original and second late fees. |
Grace Period/days | Number of days after a charge is due before a late fee applies. For example, if rent is due on January 1 and the value in this field is 5, then payment is not considered late until January 6. NOTE: The due date is included in the grace period. |
Days in Year | Appears only when the Fixed Interest, Interest Index, and Interest Index (Days) calculation types are selected. The system uses this field in penalty interest calculations. The interest is an annual amount. The interest charged equals the annual interest times (days late/days in year). The default value is 365. You can select 360, if needed. In a leap year, if you select 365, the system uses 366 days for the calculation. Options are: 360 and 365. |
2nd Fee Calc Type | If a second calculation is used, the calculation type the system uses to calculate the second late fee. |
2nd Fee Percent | If a second calculation is used, the fixed percent value the system uses to calculate the second late fee. |
2nd Interest Index | Appears only when the Interest Index and Interest Index (Days) 2nd Fee Calculation types are selected. If a second fee calculation is used, the interest index the system uses to determine the late fee percentage. |
2nd Index Factor | Appears only when the Interest Index and Interest Index (Days) 2nd Fee Calculation types are selected. If a second fee calculation is used, the value the system multiplies by the interest index value to obtain the penalty interest percentage rate. A value of one has no effect. |
2nd Index Adjustment | Appears only when the Interest Index and Interest Index (Days) 2nd Fee Calculation types are selected. If a second fee calculation is used, the value the system adds to the interest index value to obtain the penalty interest percentage rate. |
2nd Min Percent | Appears only when the Interest Index and Interest Index (Days) 2nd Fee Calculation types are selected. |
2nd Max Percent | Appears only when the Interest Index and Interest Index (Days) 2nd Fee Calculation types are selected. |
2nd Fee Grace Period | If a second calculation is used, the number of days after a charge is due before a second late fee applies. |
Invoice Fee Type | One-time late fee types. Options are: % Owed-Total—One-time percentage charge for outstanding charges. % Monthly Rent—One-time percentage charge of rent charges. Flat Amount—One-time dollar amount charge for outstanding charges in one month. % Owed-Month—One-time percentage charge for outstanding charges in one month. Flat Amount-Month—One-time dollar amount charge for outstanding charges each month. |
Invoice Fee Percent | Enter a percentage amount when the Flat Amount or Flat Amount-Month options are selected in the Invoice Fee Type field. |
Max Total Fee Type | The maximum amount for combined base and second late fees. Commonly used when either one or both of the late fees is a percentage and you are legally prohibited from or prefer not to charge late fees over a certain amount. NOTE: Per day late fees are charged separately and are not included in Max Total Fee calculation. Options are: % Owed-Total, % Monthly Rent, Flat Amount, % Owed-Month, and Flat Amount-Month. |
Max Total Fee Percent | Percentage amount used to calculate the maximum total fee. Enter a percentage amount when the Flat Amount option is selected in the Max Total Fee Type field. |
Interest Free/days | The number of days after the due date for which the tenant is not charged interest. |
Per Day Fee | The amount charged each day that rent is due after the grace period. |
Max Number of Days | The maximum number of days to apply the Per Day Fee amount. |
Min Late Fee Type | The method the system uses to calculate the minimum late fee amount. Options are: Billable—The system increases the late fee to match the Minimum Late Fee Amount. For example, a minimum late fee $1,000 and the calculated sum of late fees is $375.76. A fee for $375.76 and an adjustment of $624.24 ($1,000.00-$375.76) will be charged to tenant ledger. Threshold—The system compares the sum of the calculated late fees to the amount specified in the Min Late Fee Amount field and charges a late fee if the sum of the calculated late fees is higher than Min Late Fee Amount. No late fee will be charged if the sum of the calculated late fees is lower than Minimum Late Fee Amount. For example, if the Minimum Late Fee Amount is $1,000 and the calculated sum of the late fees is $375.76, which is less than $1,000, then no late fee charged to tenant ledger. |
Min Late Fee Amount | The amount the system uses to compare the sum of the calculated late fees based on the selected option in the Min Late Fee Type field above. |
Minimum Due | The minimum amount of late charges a tenant can owe before late fees apply. |
# of Late Instances | The number of times a tenant can make late payments before they are charged a late fee. The system calculates the late fee charge for every late instance but the tenant is not charged until the number of late payments is greater than the value in this field. This field is often used for leases with a late fee waiver. For example, a lease indicates that a tenant is not charged a late fee until the third late payment. The system calculates a late fee for the first two late payments. For the third late payment the system calculates a late fee with interest and part of the amount is applied retroactively to the first and second late payments. |
Instance Date | The date late instances begin. |
Notes | Comments describing late fee calculations and invoicing. |