How Much Should You Fine Renters for Lease Violations

As an Ojai rental property owner, setting clear and straightforward expectations for your renter is essential. Part of doing so is putting in place certain consequences for violating various terms in your lease. One method to encourage renters to comply with their lease agreement is to issue fines for violations. But on the other hand, are such fines or penalties legal? And how much should the fines be? Are there limits on the amount you can fine a renter? Let’s get a closer look at these and related issues.

Are fines or penalties legal?

Generally speaking, yes. Nonetheless, fines and penalties should be specifically detailed in your lease agreement before you can charge them. If it’s not in the lease, you cannot charge extra fees. As long as your lease agreement covers and includes language specifying the penalties and the violations they apply to, you are within your rights to issue fines.

How much should a fine or penalty be?

When sorting out or determining adequate fine amounts, think of the severity of the violation and the impact it has on you as the Ojai property manager. It’s significant to keep in mind that fines should not be excessive or wrongfully harsh. If the penalty you charge is greater than the incurred damages, the probabilities are that it will be identified as unenforceable, and you perhaps won’t win your case in court.

Another thing to consider is your ability to collect the charges from your renter. Fining a renter should only be used as a last resort for the reason that it carries such a great risk of permanently causing damage to any good relations you may have with them. If you believe you have no other choice, then setting reasonable fine amounts will add to your chances and probability of really obtaining it. Renters are more and more likely to refuse to pay excessive fines or to sue you to avoid paying them. It’s relevant to weigh the potential benefit of collecting a fine against the consequences, namely losing a renter or facing a legal dispute.

Are there limits on the amount you can charge?

It’s necessary to take note that some states do have limits on how much can be charged for certain violations. For example, states like Delaware, Nevada, and Washington, D.C. limit late rent payment fees to 5% of the monthly rent amount. Other states have regulations that state the late fee must be “reasonable” and that it must be specifically detailed in the lease.

Different states may have other limitations relating to fines for lease violations. This is exactly why it’s significant to discover and understand state and local laws before setting fine amounts in your lease agreement. It is similarly a great thought to consult a lawyer or local rental market expert just before setting fine amounts in your lease agreement.

 

In conclusion, fines and penalties for lease violations can help stir renters to comply with their agreements. Though it’s essential to make it a point that any fines or penalties you charge are legal, sensible, and in line with state and local laws.

 

Real Property Management Limitless has skilled and expert experience with all things property management, including lease agreements and tenant relations. If you need feedback and advice regarding a lease agreement or any other matter involving your rental property, contact us online to see what we can do for you.