Late fee on a hosting account?

[Fe-Hosting]

Hello everyone,

What do you think about late fees on a hosting account that was 3 or 4 days late?

Should you add a $5 $10 or even $15 or more to the account?

What would you do?

 

[SiberForum]

You mean, when someone pays you for the services after the set term? Or the feed for "re-setup" after being suspended?

Our accounts usually got suspended automatically but are restarted as soon the payment passes. No fees.

 

[AboutWeb]

Hello everyone,

What do you think about late fees on a hosting account that was 3 or 4 days late?

Should you add a $5 $10 or even $15 or more to the account?

What would you do?

Lol, you think you're government to add extra taxes ?
Just suspend the account and reactivate it when they pay.

 

[deeplist]

We send out invoices 7 days in advance. A payment reminder is sent out 2 days before the due date. Once the due date has passed, overdue notices are sent out when the invoice is 1 day overdue and then again at 3 days overdue. A final notice is sent out at 5 days overdue along with an explaination that if the account isn't paid up within the next 2 days, the account will be suspended and late fees will be added. On the 7th day overdue, the account is suspended and a late fee is added to the account. In order to have the account reactivated, the user must pay the original invoice balance plus the late fee.

The late fee is a percentage of what is owed. We do 15%. So if the customer owes us $10, the late fee would be $1.50.

 

[Decker]

Adding a fixed amount is not an option, your not providing credit cards, a percentage ranging from 5-20% as long as it's well known to the client on account creation, and fair, and stated in final invoicing is okay.

But, with a late fee should you suspend an account, till say half way through next billing period (unless of course it's VPS/Dedicated which are different in provider economic terms compared to shared accounts - resellers should be viewed as VPS/Dedicated).

 

[deanhills]

@deeplist. Is the payment system automatic? I.e. the reminders are automatic? The late fee is automatically calculated etc? And if yes, is it a standard software package or did you code all of it yourself? Sounds really professional and also more than fair.

 

[deeplist]

Yes, it's all automated. They are standard options in WHMCS, which is what I use for customer billing.

 

[wswd]

We absolutely charge late fees. We'll get clients who are gone due to lack of payment for 30 or 45 days at a time, then just expect their accounts to get reactivated when they come back and pay. Sorry! After 30 days, the content on all unpaid accounts is transferred to a backup server. After 60 days, it's deleted.

If clients come back and pay after the 30 days, we charge a late fee because somebody has to physically transfer their data back to a production server and setup the account all over again. It's a huge hassle, and we charge for such hassle.

 

[WebIntellects-R]

We absolutely charge late fees. We'll get clients who are gone due to lack of payment for 30 or 45 days at a time, then just expect their accounts to get reactivated when they come back and pay. Sorry! After 30 days, the content on all unpaid accounts is transferred to a backup server. After 60 days, it's deleted.

That's reasonable. But surely not for few days after being late for payment.

Our system is automatic. It gets accounts suspended as soon as billing period ends. Usually we restart it as soon as the payment comes up.

 

[hostcolor]

This is a Policy that any web host should decide whether to implement or not. We didn't charge late fees for years. Now we charge a small fee which is added to the invoice 7 days after the expiration date of the service.

 

[LandonM]

Hello,

Payments against acquired hosting services vary from employer to employer. If you are the frequent payments customer so once in a blue moon late payments are usually accepted.

 

[hourb]

Lol, you think you're government to add extra taxes ?
Just suspend the account and reactivate it when they pay.

i willl just do what this guy says he is right!and you may put him pays a fee 2$

 

[pingpipe]

Having late fees gives your clients an incentive to pay on time. I'd recommend a set percentage of the amoung owing rather than a fixed fee, it's more fair to each party.

 

[deeplist]

I invoice people 7 days before their due date, and I'm done ----ing around. They are aware of my 7 day grace period and I've had enough of "being nice" and waiving late fees when they finally pay up 7 days overdue. All payments are due on the 1st of the month. If I don't have your money in my account by 11:59 PM on the 1st day of the month, you're getting a 15% late fee added to your invoice. If I don't have payment in full (including the late fee) by 11:59 PM on the 7th of the month, your account is suspended until payment is made.

 

[Seraphim]

I will usually talk to them about the matter, they're allowed to leave their account in the red for one month if they have a good excuse as long as they pay off the balance owed on the next payment. My system is designed for prepay operation as well, so in cases like this I will often recommend that in the future they try to pre-pay a month or so in advance so as to have a cushion if they have to skip a payment for whatever reason.

However any accounts I see showing money owed for two consecutive months or that I am not able to get in contact with within 2 weeks of the payment being due are suspended until paid in full. Usually I stop the billing clock as well though once an account is suspended.

There's no real need to add a late fee, as any client who intends on actually using the services they agreed to pay for will usually want to avoid an embarrassing account suspended message and the site downtime that will happen if they don't get their payments in on time.

The system I am currently using sends payment reminders every 30 days if after deducting that month's balance from an account the account does not have enough funds to cover the next month's payment. They then have that month to get another payment in, which is credited to their balance. Doing it like that it automatically handles prepaying clients as well as monthly scheduled ones, since it simply counts-down the balance and sends an email when it is running low.

 

[deeplist]

You must not have a very large operation. The larger you get, the more deadbeats you pick up. It goes beyong trying to "talk" with them because most will just completely ignore you until you cut them off. Then (like magic) within a hour or two, you'll hear from them.

 

[Seraphim]

The sad part is at my current scale all of the deadbeats are people I actually know. Everyone else is either free or pays like clockwork- a few even paid anyway on a month when I credited them for downtime and they didn't have to.

As time goes on I'll probably have to be more strict about it to keep the balances owed at a minimum in order to avoid letting them leech my business to death. But for now the figures are so small that I am paying the bulk of the bills out of my own pocket anyway.

 

[EXBInt2010]

We absolutely charge late fees. We'll get clients who are gone due to lack of payment for 30 or 45 days at a time, then just expect their accounts to get reactivated when they come back and pay. Sorry! After 30 days, the content on all unpaid accounts is transferred to a backup server. After 60 days, it's deleted.

If clients come back and pay after the 30 days, we charge a late fee because somebody has to physically transfer their data back to a production server and setup the account all over again. It's a huge hassle, and we charge for such hassle.

We use the same method as yours There are clients came back after 90-day of expiry date and by the time, the webfiles and database already removed from our servers. Sorry for late and please re-do your website

 

[ptimo3]

Would depend on the client..
I have regulars who go overtime ... but i know em personaly ...
but i don't think adding a latefee is a bad thing, unless you suspend em ..

 

[Derek Flahost]

I believe it is necessary to place a late payment fees on those who pay more late than 7 days. A lot of consumers, they usually reluctant to pay, although they had enjoyed the service. Placing a late payment charge will make them pay on time.