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Question added to topic MoneyAugust 14, 2008

I own a pet-sitting business. Can I charge clients interest if they don't pay within, say, a month?

You cannot charge interest--and expect them to be obligated to pay it--if you have not previously notified your clients that you will do so if payment is late. That's changing the terms of your agreement.

If you could get away with that, your clients could just as easily come back to you and say, "I'm not paying you $100 per dog sit; I'm only paying $50," and you'd have to stick with that.

However, if you had a written agreement (that they signed) stating your fees and that interest would be charged on late payments, then yes, you would be entitled to collect, because it's part of your contract.

Even better, get the client to agree (in writing) to monthly charges to a valid credit card. That way, you won't have to deal with late payers.

Nina L. Kaufman, Esq. is an award-winning New York City attorney, edutainer and author. Under her Ask The Business Lawyer brand, she reaches thousands of entrepreneurs and small business owners with her legal services, professional speaking, information products, and LexAppeal weekly ezine. She also writes the Making It Legal blog.

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