How are payments applied to charges? FIFO!

Posted on August 19, 2015

Payments are applied first-in, first out. Any existing charges are satisfied by ANY new payment, from the oldest charge to the newest.

Any prepayments on an account also apply to the oldest charge to the newest.


You may intend a payment to be for rent in full; however, if you have ANY outstanding charge, your payment will be applied to that charge first and if the payment is not sufficient to cover the outstanding charge(s) AND your current rent, then you will have a balance due on the current rent and late charges will accrue from the due date.

You can write “rent” on a check, but if you have an outstanding balance say for water or a bounced check, etc, that’s what your payment is going to go to first, just like a credit card account.

Multiple leaseholders and Prepayments

When you intend to prepay¬†rent (compared to your roommates), your payment will first go against all existing charges. So, if your roommates have not yet paid (slackers…), then your payment goes against those charges, and not in as a prepayment for your personal share (remember, we NEVER account for “personal shares”). Your roommates would absolutely owe you, and we can help sort that out if you put a note on your payment that indicates what you intend it to be for (that way, you can look it up later), but you would not have a ‘credit’ on your account in your name. This is because in essence ‘your account’ is your unit’s account, NOT your own account.

This is simply a result of the “all for one and one for all” nature of a jointly and severally liable lease.