Renting an Apartment

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I stayed at an apartment complex a bit with someone. The rental people said the rent was due on the first of every month but if I was late I could turn it in on the third. I was and still confused by what the rental people said here. There was no penalty for being late as well?

Was my rent due on the 1st or the third? It seems like by what they said they cirumvent their own rule of being due on the 1st. They do this in an indirect manner.

Another question is why do they do this? Why don't they pick a specific due date and say this is the absolute due date? Why do they have this roundaboutness and all of this circumvention? I do not understand it.

It's like there is a due date and then a penalty date. I have two mortgages, both say they are due on the 1st but if payment is not received by the 15 th a hefty penalty will apply.

I have tenants in one of the houses. I say the rent is due on the 1st, but on the 5th, a penalty will apply.

I think this is standard and basically just formalizes the allowance for...I get paid on the 1st but the 1 st is Sunday, so can't until the 2 nd. There are a multitude of reasons why exceptions are made, this just keeps it simple. It also keeps the 1st as the official date for legal reasons if eviction proceedings are necessary.

Kailuamom, I think I may understand what you are saying. Basically, what you are saying is it allows for certain events that can happen like a holiday or something like that? What you are saying is this due date can't be 100% strictly enforced in an absolute manner and there has to be wiggle room? Am I correct? This must be one of these grey areas that I have problems dealing in.

There needs to be wiggle room BUT it's too hard on a landlord to be deciding when to wiggle. So...they give you a defined wiggle, dnt even ask past that. If you don't pay by the "penalty date" and they start to evict you - all of the papers will say the 1st was the due date.

This is actually a way to manage they gray area in a black and white way.

I think I may be understanding. I am going to put this in a formal logical system if you do not mind. Will you please comfirm if I am correct or not if you do not mind?

a. Our society called The United States of America is a time oriented society.
b. Premise a means we govern ourselves by our clocks and our calendars.
c. Our calendar has a system of organization.
d. This organization is divided into different segments like years, months,etc.
e. There are certain time frames and due dates when things are done in and by and certain events happen.
f. Some due dates and events can grey up and mesh together.
g. if premises a, b,c d, and e are true then f is true as well.
h. if premise f happens then a rule must be added to cover this.
i. The rule is a set of ranged dates must be created for the due date.
j. if you don't pay once this range is passed you will be penalized and possibly evicted.

Am I correct?

Mostly -

I would change this:

f. Some due dates and events can grey up and mesh together.

to

f: There may be times when a given "due date" is impossible to meet. This could be for a variety of reasons, of which no one wants to be privvy to the details.

Here's another factor.... Do not apply this logic to ANY OTHER SITUATION. This is a contractually defined arrangement. Therefore, while you will become accustomed to seeing these arrangements in financial dealings, each sitaution is defined seperately and typically by the the person providing a good/service in exchange for payment. SO - with my tenants, I define this rule, and they either agree or find a situation which suits them better. With my mortgages, the banks define this rule and if I don't like it I need to find another bank.

Does this help?

this is called a "grace period" during which time your payment is considered as on time. many legal transactions include a grace period, like credit cards, rental agreements, loans, etc. in the case of your apartment, payment is due on the 1st, you are given a grace period until the 3rd, after that date, late penalties apply.

some state laws will dictate grace periods in the case of rental agreements. for instance, texas housing laws give a 1 day mandatory grace period for rental payments. massachusetts law gives you 30 days before they can charge late fees. in michigan, there is no grace period given in the laws. so your grace period may not be the choice of the landlord but could be a requirement by the laws of your state. some laws also restrict the amount of late fees that can be imposed.

i manage an apt complex in michigan. our rents are due on the 1st and we give a grace period until the 5th, after that you pay late fees. if the 5th is a holiday or weekend, we extend the grace until the next business day. the grace is a courtesy for our tenants, we could charge late fees on the 2nd if we choose, but we tend to be pretty lenient. for all legal intents and purposes, rent is due on the 1st as stated in the lease. the laws dont restrict what we can charge as late fees, but practical experience has shown us that judges in an eviction proceeding will often refuse to enforce a portion or sometimes the entire amount of late fees.

best thing to do, just pay everything by the due date. that way there is no confusion and no surprises.

I 100% agree with this.

Thanks, both of you. This helped to clarifiy this a lot. I did not know about grace periods. I just looked it up. http://en.wikipedia.org/wiki/Grace_period

By what this says, I need to treat the due date as the actual due date. Make sure I get the rent by the actual due date. Don't treat the end of the grace period as the actual due date. If something unforseen happens I may have to pay a bit later and that is only when I use the grace period. Only use the grace period in emergency situations? Am I correct?

Both of you ladies are awesome!! !!


Out of curiosity where did I go wrong in my thinking on this at first?

I don't know that your thinking was "wrong", you just didn't understand the basis. Once we spent some time on it it made sense, right?

NOW - to gray it even more for you. It makes sense to treat the due date like the due date, especially when the grace period is not contractual. For instance on my credit cards there is a mystery grace period - I don't know what it is and I don't mess with it.

However with my mortgage, the grace period is contracted to the 15th. They can't asses any penalty prior to that. Therefore, I make sure my mortgage is always in by the 10th or 12th, but I don't worry about the 1st.

It makes perfect sense now that you broke it down for me.



When you mean contractual does it mean that it has to be rotely stated on the contract? Is this the correct definition?

When I get my mortgage invoice it explicitly says due 1st, penalty on the 15th. My car payment is the same - so for those - there is a written contract that stipulates when a penalty will apply, I make sure I am never past that date.

When there is no written agreement of when a penalty applies, always count on the due date being the due date.

thats the best, and most financially responsible, way to look at it.

what i generally see is that someone who pays consistently by the due date rarely falls behind or ends up with a late fee, because the grace period is there to save them. those that take advantage of the grace period tend to repeatedly fall behind or more frequently get late fees assessed. the grace is a safety net, and when you use the safety net every month, its not there when you really need it.

With this ladies, I fully and logically understand.

Due dates are the date from which interest can run, if applicable, like on a bill, as well.

Just to complicate things, because I agree that the standards you all have developed in this thread are sensible, I'll throw in the time value of money and how savvy business people usually handle these dates.

I take the "no later than" or penalty date as the day by which I must really pay. Shoot, if you auto-pay your mortgage through your lender, THEY take the "no later than" or penalty date as the day they take your draw. This gives you the float on having your money in a savings account, instead of giving that interest to the person who sent you the bill.

But, you have no room for error with that. No room to "forget." It all depends on how good you are with your bill paying.

Most businesses have the due dates automated, so they can push at the line and never be late. We also have all our bills automated, on autopay, but that is not recommended for people on a tight budget, because it is easier to overspend when you are not forced to see the bills. The alternative is what we used to do, sorting all our bills into 2 date ranges, and then sitting down twice a month to pay them. We made sure the credit card and mortgages were due on the opposite sides of the month, decided what the optimal date was to pay them (making sure there was never a penalty, but maximizing the float on our money), and then grouped the smaller bills with one or the other.

Of course, caring about the float was a much bigger deal when interest checking paid you 8%. Right now ... who cares? You pay the bill as soon as you have the money to pay it.