Early Payment Discount?
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Many landlords don't like to give the tenant a discount for paying 
the rent on time or early. The sentiment is: "Why should I reward the tenant for doing something they agreed to do anyway?" I agree with the sentiment, BUT I have to disagree with the reality of it. Why not reward your tenant with good money managment?
Wouldn't you rather have the bulk of your rents come in a week to 5 days before the first of the month? How about this solution: build a $5 or $10 early payment discount into every lease. Good responsible tenants want that discount and have a reason to pay early. It sure beats sending late notices and chasing the rent each month. More importantly it saves valuable time and would give you peace of mind too.
If you don't have this clause already in your lease, you can also present your tenants with a created form called an 'Early Payment Discount Voucher.'
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Lyn Sims (847)230-7324
RE/MAX Suburban
Email: LynSims@msn.com
Resources: LPA landlord protection agency, November 2009
Good idea, Lyn:) It is nice to encourage peopel to be so good about paying you!
Courtney, maybe it's a good idea to start thinking about. With the average tenants credit score on the downward slide, many landlords worry if they will make their rent on time. Just a small incentive possibly.
Lyn - I agree. We always get more of behavior that is rewarded, and why not encourage your tenants to make life a bit easier for you?
Lyn--I think it's a great idea, especially if it is already built into the lease. That way, even if the rent is on time or late you still cover the baseline rent amount. I also think it is more motivating than the threat of a penalty.
John
John & John: Glad you both agree. More positive than always hitting on the penalty.
Lyn...we have one rental and we built in a discount and a penalty. Works really well.
Bill: Glad it's working for you.
Lyn - I think $5-$10 is worth putting my mind at ease knowing the rent is paid for the coming month.
Lyn, My leases do not have a late fee per se, but they do include an early rent discount. I make it significant so that the tenant wants to save the money. I also advertise the rent at the higher amount. So if I want to net $950, I advertise $1000.
The clause says something like this:
Rent is $1000 per month, but if it is received prior to the 5th of the month, tenant shall receive a $50 rent discount making the rent $950.
Going back to Pavlov's dogs, we all respond better to positive reinforcement rather than negative. The $50 rent discount turns into the late fee if they don't pay on time.
Michele: Nice touch with that rent clause, more of a postive than a negative punishment. Thanks for commenting.
The early payment discounts are a win/win and I have personally known them to be very effective, especially with habitual late-payers....
Thanks for your input Janna.
Wouldn't that be cool if you could get one month free if you pay a year ahead of time too? Good ideas Lyn!
Renee: That would be a great idea! Wonder if anyone is doing that and will comment.
Lynn, at times I've seen landlords offer an incentive for paying on time! Depends totally on the market. Right now, in Arizona, we have an influx of rentals due to the investors in our market - again! ;-)
That won't be good for rental prices, the more rentals available the lower the rent.