Late Payments...Can we really charge interest?

[alcpi]

If we designate a certain due date on our statements and the customer is past due, can we legally collect interest? I assume we must inform customers prior of this policy. Does anyone have experience or knowledge in this area? Thanks!

[qualitylandscaping]

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I put put on your invoice,,, "Payment in full is due within 30 days. Late payments will be assessed a $1 per day late fee"

Or something to that affect.. To my knowledge, it is legal to collect late fees, but you should check about charging intrest..

[BRL]

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Each state has its own laws regarding this, so it is best to check in your state. You are not a bank so you are not charging interest, you are charging a late fee. From what I've read at various message boards calling it "interest" means you have to follow certain rules & regulations that a bank has to follow. Since we have enough Green industry regulations, you probably don't want to get involved with complying with bank regulations. The individual laws of each state also usually give an amount that you are allowed to charge, or a maximum amount (usually a percentage of the balance due?).

[alcpi]

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I'll check it out, thanks!

[grasshopper]

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You can charge a late fee if you want, but you would be taking a chance at losing a customer. That's why you have to be careful. If you piss someone off they can easily find another company to come cut their lawn. Also, remember that if they are a problem getting paid from regularly then you will most likely have a problem collecting extra money from them.

[GrassMaster]

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Hello Everybody:

I would only charge a late fee when I had to take them to court for nonpayment & only that!

Is it worth it to lose a customer for a $1.50 on the $100? Where I'm at work is very hard to come by.