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What, When & How: Tenant Chargebacks In Property Management

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Have you ever done work to a property that should have been the responsibility of the tenant? Maybe you spent money on a locksmith because someone lost their key. Or repaired a window that was in perfect condition when the tenant moved in. A tenant chargeback refers to any charge that you need to pass along to a tenant. We’ll give you some examples and show you how to make them easier to set up and track with Yardi Breeze.

landlord receiving cash reimbursement for tenant chargeback

What’s a tenant chargeback?

A chargeback occurs any time you spend money on a property when the cost is the responsibility of a tenant (aka you need to be reimbursed). It may also be referred to as an expense recovery.

examples of chargebacks

  • Broken window repair
  • Locksmith
  • Emergency plumbing
  • Bulky trash pickup
  • Door or railing repair

When do you create a chargeback?

You will create a chargeback whenever you spend your own or your owner’s money on something that is the tenant’s responsibility. You should be upfront with tenants about chargebacks and expectations from the get-go. In fact, it’s a great to spell out potential charges in every lease. After all, no one likes receiving a surprise bill from their landlord. And if you cover yourself in the lease, you’re more likely to avoid legal conflict.

Tenant chargebacks for commercial properties

For commercial properties, you can use chargebacks instead of, or in addition to, charging estimates for expenses and doing reconciliations at the end of the year. If you do this, specifically outline which expenses are being passed onto tenants in your lease.

Read: Quick CAMs? Save Time With Automated Common Area Maintenance Reconciliation

How do you complete a chargeback?

When you’re using manual processes or spreadsheets to manage your properties, chargebacks can be tricky. Do you handwrite an invoice? Do you attach it to their rent? If you’re using property management software, it’s much easier.

Breeze streamlines tenant chargebacks. First, you’ll open the payable invoice with the expense that is being charged back to tenants. Then select Charge Tenants to create and post a charge to their account.

You can distribute the expense among the tenants of a property, or you can select one or more individuals. Tenants can see their chargeback charges in their secure tenant portal or on a tenant invoice that you print or email.

Pro tip: Tenant chargebacks work the same in Breeze and Breeze Premier.

And there you have it: easy tenant chargebacks, courtesy of refreshingly simple property mangement software.