Removing or Reducing Late Fees During Payment Posting

Modified on Wed, 6 May at 4:06 PM

Overview

This guide explains how to remove or reduce a late fee on an invoice while posting a payment in Cornerstone Billing Solutions. Using the Change Late Fee button during payment posting keeps your financial records clean, creates an automatic adjustment record for reporting, and eliminates the need to use the Write-Off button for late fee adjustments.

This guide covers the step-by-step process, when to use Change Late Fee versus Write-Off, common use cases, and best practices for managing late fee adjustments.

How to Remove or Reduce a Late Fee

Follow the steps below to adjust a late fee while posting a payment. You can either remove the fee entirely or reduce it to a lower amount.

Click the Post Payments icon.
Navigate to the correct customer account.
Highlight the invoice or invoices that have late fees you want to adjust.
Click Change Late Fee.
Make your adjustment — remove the late fee completely or reduce it to a lower amount.
Complete the payment posting process as normal.

⚠️ IMPORTANT

The Change Late Fee button is only available during the payment posting process. If you need to adjust a late fee outside of payment posting — for example, from the Open Invoice List — highlight the invoice and click Change Late Fee on the Post Credits screen. For full details on the Post Payments screen and how tagging and adjustments work, refer to the article Untitled Article (Posting Payments - Related Accounts, May 6, 02:30 PM).

How Adjustment Tracking Works

When you use Change Late Fee, the system automatically writes an adjustment record. This record gives you a complete trail of all late fee changes and supports reporting and audit requirements. Specifically, adjustment records allow you to:

Track how much in late fees has been forgiven
Generate reports on late fee adjustments
Maintain audit trails for customer service decisions
Monitor trends in late fee waivers
Review late fee forgiveness by individual customer
Analyse late fee adjustment trends across your portfolio
Maintain compliance with internal and external audit requirements

When to Use This Feature

Common scenarios in which adjusting a late fee during payment posting is appropriate are shown below.

Scenario	Description
Customer goodwill	Waiving fees for good customers with occasional late payments
Payment plan agreements	Reducing fees as part of payment arrangements
Billing disputes	Removing fees when delays were due to billing issues
System errors	Correcting incorrectly applied late fees
Special circumstances	Handling extenuating circumstances on a case-by-case basis

Change Late Fee vs. Write-Off — Which Should I Use?

Using Change Late Fee during payment posting keeps your financial records cleaner and more organised than using the Write-Off button for late fee adjustments. Use the table below to determine which tool is appropriate for your situation.

Use Change Late Fee When…	Use Write-Off When…
Adjusting late fees during the payment posting process	Writing off bad debt or uncollectible amounts
You want proper tracking of forgiven late fees	Handling non-late-fee adjustments
You need an adjustment record for reporting	Processing other types of account adjustments

Best Practices

To effectively manage late fee adjustments across your team, follow these recommendations:

Use Change Late Fee during payment posting for efficiency and accurate record-keeping.
Document reasons for late fee adjustments in customer notes when appropriate.
Review adjustment reports regularly to monitor trends in late fee waivers.
Establish clear policies for when late fees should be waived so decisions are applied consistently.
Train staff consistently on late fee adjustment procedures to ensure uniform use of this feature.

The following articles cover features that work alongside late fee adjustments:

Untitled Article (Posting Payments - Related Accounts, May 6, 02:30 PM) — Full details on the Post Payments screen, including how to tag invoices, view related accounts, and use the Write-Off function.
Untitled Article (Billing & Payments, May 6, 02:17 PM) — How the payment adjustment confirmation screen works when removing, reducing, or writing off a payment.
Untitled Article (Billing & Payments, May 6, 02:26 PM) — How to apply discount and prepaid credits across multiple open invoices, including the Change Late Fee option available from the Post Credits – Open Invoice List.

Need Additional Help?

Our Customer Success team is here to assist you.

Phone: 847-405-9517 x1
Email: customer.success@alarmbills.com