Should rental property owner refund late fees?

Hi, there! Joe White here from Grow Property Management, your trusted property management company in Philadelphia.

Recently a tenant reached out overnight, realizing he missed the rent deadline by mere minutes. He's asking for an exception, and while I'm inclined to grant it, there are significant risks involved. We have to treat every tenant equally to comply with Fair Housing laws. Government agencies, despite our assumptions, aren't always focused on what's right and wrong but rather on catching any violations. Once they're onto you, they pursue regardless of the circumstances.

By making this exception, we're potentially setting ourselves up for scrutiny during audits. Fair Housing might question why we gave preferential treatment to this tenant, potentially even alleging discrimination based on race or sex. It's a precarious situation, especially considering our numerous tenants and the possibility of inconsistent treatment.

If I remember this incident, I could argue it as a one-time exception based on a policy of refunding late fees for minor infractions. However, relying on memory alone is risky, and we must establish and adhere to clear policies to avoid potential legal entanglements.

The key takeaway here is to be cautious and consistent in our approach to tenant management. Establishing robust protocols and adhering to them meticulously can mitigate the risk of inadvertently favoring one tenant over another and facing repercussions from regulatory bodies. It's not just about what's right or wrong; it's about navigating the complex regulatory landscape while ensuring fairness and compliance.

Alright, as usual, happy rental property investing!