Late rent and bank charges

[t1grm]

I rent several properties out and on several occasions I’ve incurred excess overdraft fees because bills have gone out and rent has not been deposited on the due date. Am I entitled to deduct these charges from the deposit?

[chrisgr31]

t1grm said:

I rent several properties out and on several occasions I’ve incurred excess overdraft fees because bills have gone out and rent has not been deposited on the due date. Am I entitled to deduct these charges from the deposit?

Depends on the terms of your agreement but I doubt it!

The easier solution would be, assumming the bills are on direct debit, to make the dates of the Direct Debits later giving more time for the rent to be paid.

If I were you I would be worrying if the incoming rent was so crucial to my finances that a late payment caused overdraft charges. After all what happens if a tenant doesn't pay at all, or the property becomes vacant?

[t1grm]

I've had a few one off bills lately so cash flow's a bit tight at the moment. Plus I always draw the minimum salary I need to cover my bills and living costs and leave any other cash in the company to take as a dividend. I have savings elsewhere to cover the eventuality of a property becoming vacant but it would take 5 days or so to transfer which is no good if the rent is five days late and you have a big bill going out the next day.

The two DD’s causing the problems are about 5 and 7 days after the rent is due so I suppose I could move them. Trouble is you keep thinking oh I'll give it another day to see if they pay before transferring funds from elsewhere to cover it and by the time it's clear the rent is not going to arrive for another week it's too late to transfer the other funds in time. I always get the balance back down about a day or two later but my bank are charging me 25 quid a day so some months it’s costing me up to 75 quid.

I would have though if I could show that my overdraft limit plus the rent in arrears is more than the amount I'm overdrawn by then they should cover the excess charges.

I guess another solution would be to keep a "float" equal to the value of the rent in another account with the same bank that I could shift around if it's late.