Lease
Buy-Out Fee
FB: We require 30 days’ notice plus one month’s rent, but it also depends on how many months remain on the lease. Remember, we’re really doing them a favor.
GG: We do the same, and payment must be made by money order. Residents also must give 30 days’ notice or pay the next month’s rent on top of that.
SO: $300.
BS: In this economy, many residents skip without paying an early termination fee, so we just keep their deposit.
Damage Fee
FB: If there is carpet damage, for example, when a resident moves out, we take into consideration the carpet’s age. If it’s 5 years old, we may not charge anything, but if it’s only 2 years old, we may charge the resident the total cost to replace it.
BS: At move-in, we tell residents how much we charge for various damages, should they occur during their tenancy.
Accent Wall Painting Fee
FB: We do the job in-house for about $20 and charge residents $150.
KW: It’s $6 more per month on a resident’s lease if they want us to paint the accent wall.
By getting residents to subsidize such capital improvements, our residents pay only for what they want.
Trash Fee
FB: We charge $5 to $9 per month for traditional refuse service at every property.
No residents have resisted paying it.
Disengaged Smoke
Detector Fine GG: After the first offense, a warning; after the second, a $10 fine.
SO: We charge $25 to re-install smoke detectors.
BS: $25.
Trash Left in
Unauthorized Areas GG: Fines are levied per incident (not per bag) and start at $10.
SO: We charge whatever it costs for a maintenance employee to take the garbage to a dump.
BS: $25.
KW: If groundskeepers see bags of trash where they shouldn’t be, they go through the bag and find a bill or piece of mail that helps to identify which unit it came from. We then charge a fine of about $25.
Late Rent Fee
FB:10 percent of one month’s rent or $50 to $100, depending on the state.
GG: On the sixth day of the month, there’s a flat $35 late fee. On day 10, the penalty rises to $65.
SO: If their rent is $400 or less per month, we charge a $20 late fee on the sixth of the month. We charge an additional $20 if they don’t pay by the 10th.
BS: Flat fee of $60.
Carpet Cleaning Fee
GG: It’s free at the time of lease renewal. Any other time, at the resident’s request, we charge $35 to clean well-trafficked areas.
Application Fee
FB: We charge $75 to $125, depending on the state. But if the competition heats up in that market or during a down economy, we may waive the application fee. We also have an administration fee of $25 to $50 for the credit check.
SO: $25.
BS: $25 per adult applicant.
Insufficient Funds Fee
FB: $35 to $50. It’s state-specific.
GG: It’s $25, plus the $35 fee for late rent. That resident is then not allowed to pay by check for the next six months. If they pay on time during that six-month period, they can resume paying by check.
SO: It’s $50 for a bounced check, and $250 if it bounces a second time—though we’ve never had this happen.
BS: $25.
Extra Occupant Fee
BS: We charge $50 to screen them and add them to the lease as long as they meet our guidelines.
Extra Vehicle Fee
GG: Parking availability at some older C or B properties that have been rehabbed tends to be limited, so we may charge $10 per space per month for those who have more than one vehicle.
Utility Meter-Reading Fee
FB: We charge $2 to $4 per month per unit for the utility vendor to read the meters over the phone lines. This fee includes the preparation of each unit’s monthly invoice.
BS: $6 per month.
Lockout Fee
GG: $25 after business hours.
SO: $25 as well, and the maintenance employee on call keeps the money.
BS: $50 to do it after business hours and the maintenance employee keeps it.
KW: There is no charge if residents lock themselves out during regular leasing office hours. After hours, we charge $45, all of which is kept by the maintenance technician. We could use this as ancillary income, but the on-call aspect of
maintenance employees’ jobs is never fun, so we let them keep the money.
Pet Fees
GG: We charge up to $300 for a pet deposit, half of which is non-refundable. We also charge $5 per pet per month in “pet rent.” There’s a $100 fine if we find unauthorized pets, and the resident then has to pay the regular pet deposit as well. The $100 fine collected is given to a local pet charity, such as the SPCA. Doing this helps to improve our moral standing with residents, rather than treating this money as income.
SO: We charge a $200, one-time,
non-refundable fee per pet.
BS: $300, non-refundable.
KW: We charge a $500 pet deposit fee and encourage honesty by offering a 50 percent discount to residents who pre-register their animals before move-in (or before they bring the new pet home). When possible, we try to “spin” penalties into incentives.
Month-to-Month Renewal Fee
FB: We charge $50 to $100 more than market rent.
GG: An additional $30 a month for month-to-month.
BS: $25 more than the market rate as specified in the lease at move-in.
Gate-Remote Fee
FB: We charge $50 for every gate remote we give to a resident. Half is refunded if they return the remote at move-out.
More than 50 Independent Rental Owners (IROs) nationwide participated in a December conference call hosted through the Independent Rental Owner Committee (IROC). The call, themed “Problem Sharing and Problem Solving,” included a discussion on ancillary income items many owners have used to improve their ROI.
On these pages are fees owners have had success in implementing, with responses from five of the call’s most vocal participants.
Got a Question?
Frank Barefield
President
Abbey Residential LLC
Birmingham, Ala.
8,000 units
frank@abbeyresidential.com
Greg Guerrero
Owner
Apartment Services Company
Tulsa, Okla.
1,300 units
gguerrero@arightservices.com
Sharon Oglesby
Owner
Oglesby Management Group
Lynchburg, Va.
800 units
sharonoglesby@comcast.net
Brent Sobol
Owner
Happy Home Communities
Atlanta
1,100 units
brent@happyhomecommunities.org
Kevin Wolfgang
President & CEO
Evergreen Apartment Group
New Castle, Del.
815 units
comments@evergreenapartments.com