Overview
This is a firm-wide setting that can be enabled/configured from the Client Billing & Invoice Settings page:
MyCase will automatically add a new late fee line item to invoices based on the firm's designated settings when enabled. NOTE: interest will only be applied to invoices created AFTER this setting is enabled. Past invoices will not be impacted.
Supported configurations include:
Percentage: the fee percentage to be applied to an overdue invoice.
Interest Type:
Simple: The interest rate will be applied solely to the invoice's principal.
Compound: The interest rate will be applied to both the invoice's principal and previously accrued interest amounts.
Charge interval in days: the cadence in which additional interest will be applied.
Late fees grace period: the number of days after the invoice's due date on which the first interest line item will be applied.
In the image above, a user has designated a 1% fee (12.8% APR) to be charged to an invoice starting one day after the invoice's due date. Additional interest will be added every 30 days until the invoice is paid.
Payment Plans
If an invoice has been added to a payment plan, we will charge interest on the individual installments of the plan.
For instance, let's consider a scenario in which a $1000 invoice is broken into four installments of $250, each due 30 days apart. The invoicing firm has auto-apply interest enabled to add a 2% simple interest line item to an invoice the day after the invoice is due, with additional interest added every 30 days. If the client is delayed in paying both the first two installments, the first by 32 days and the second by two days, the first installment will have accumulated two interest line items, each for 2% of the principal totaling $10, and the second installment will have accrued one interest line item of 2% totaling $5.
Balance Forwarding
If an invoice contains a forwarded balance from a previous invoice, we will treat the forwarded balance as part of the invoice's subtotal, similar to any other line item (e.g. time entries).
For example, let's consider the scenario in which a firm has configured MyCase to apply a 1% simple interest on a 30 day cadence for late invoices, starting one day after the invoice is due. This firm forwarded an outstanding $1000 balance to a new invoice that also has a $100 time entry and is due on July 1st. We will apply the 1% interest on July 2nd to the total balance of $1100, totaling $11 in interest. We will apply a second $11 interest line item 30 days later.
Turning Off Auto-Apply Interest for Individual Invoices
By default, all invoices created after enabling auto-apply interest will be subject to the configurations designated by your firm. If you wish to disable auto-application of interest for an individual invoice, you may do so by opening the relevant invoice and toggling off "Auto-Apply Late Fee" in the top right hand corner of the invoice.
NOTE: Automated Interest will only default to "on" for individual invoice creation at this time, not batch billing.