Apartment NSF Fees

Apartment Budget Installment

NSF or Non-Sufficient Funds Fees are not uncommon thing in the world today. In fact they have been around for a very long bit of time. Simply defined, it is a fee for a returned check be it paid by electronic or paper method.

NSF Amounts

The amount can be anything within reason. I have seen them range from $25 to $125 depending on average rent rates, markets and sub-market primers.

Reason for NSF

The chief reason in my head is to shape behavior. Not to penalize. Suffice it to say – if a resident has to add $125+/- to their rent check, they will likely not do it twice. It will likely feel like an excessive amount and thus a penalty but it will shape the behavior you are after.

How to Budget for NSF Fees

Where you have trailing historical numbers, you can simply take a 12 month trailing average and plug that number for the forward-looking 12 months. Where you have no information, you can look for like kind assets in the market do per unit comparisons to come up with your averages [something I will define with more detail in future articles].

I leave it at that this week. NSF Fees are fairly straight forward but I have left some nuggets out in hopes that we pick them up in the comments.

Publicly Calling Out

Speaking of – I am going to reduce to a lower means of influencing by publicly calling out a member of our accounting team. I will only identify her as CK for now and I hope that she joins the conversation at some point as it was her idea to get the budget series started.

Your enjoying the weather today multifamily maniac,


Author: Mike Brewer

Out to put a dent in the multifamily universe. Love compelling conversation...