Late fees on rent: how they work, with state limits
A late fee is a charge in the lease for rent paid after a set day. Many states limit when it can start and how large it can be: New York caps it at the lesser of $50 or 5 percent of monthly rent, Maine at 4 percent, and Texas treats 10 percent as reasonable for buildings over four units. Your fee must be in the written lease and must follow your own state’s rule.
How a rent late fee works
A late fee is a contract term. The lease says when rent is due, the last day it can arrive without a charge, and the charge if it arrives after that. The fee is meant to cover the owner’s real costs of late payment, such as time spent chasing and the effect on paying the mortgage, not to punish. Courts and legislatures look at that purpose when they decide whether a fee is too high.
Three things are regulated in different states: when a fee can start (the grace period), how large it can be, and what has to be written in the lease. A few states also say what a late fee cannot be used for, such as making the next month’s rent count as unpaid.
Examples of state late fee limits
These are examples from the statutes themselves. Many states set no number, and many cities add their own rules, so check the law for your property’s location.
| State | Earliest a fee can apply | Size limit | Statute |
|---|---|---|---|
| Texas | Rent unpaid two full days after it was due | Must be reasonable; treated as reasonable at up to 12% of rent (4 units or fewer) or 10% (more than 4 units), or more if it does not exceed the owner’s uncertain damages | Property Code 92.019 |
| New York | Rent not paid within five days of the due date | Lesser of $50 or 5% of monthly rent | Real Property Law 238-a |
| Oregon | Rent not received by the fourth day of the rental period | A reasonable flat fee, a daily fee up to 6% of that flat fee, or 5% of rent per five-day period | ORS 90.260 |
| Maine | Rent not paid within 15 days of the due date | 4% of one month’s rent | 14 M.R.S. 6028 |
| Massachusetts | Rent unpaid 30 days after it was due | No interest or penalty before then | M.G.L. c. 186, 15B(1)(c) |
Sources: Texas S.B. 1414 (2019), which set the current wording of 92.019 for leases signed or renewed from September 1, 2019; New York RPL 238-a; Oregon ORS 90.260; Maine 14 M.R.S. 6028; Massachusetts c. 186, 15B. Texas also requires the fee to be in a written lease, and Oregon requires the lease to state the fee type, amount and dates.
Worked examples
Example a made-up New York unit rents for $1,800 a month. Five percent is $90, which is more than $50, so the most the owner can charge is $50, and only if rent is not paid within five days of the due date.
Example a made-up New York unit rents for $900 a month. Five percent is $45, which is less than $50, so the cap is $45.
Example a made-up 20 unit Texas building rents a unit for $1,400. Because the building has more than four units, a fee up to 10 percent, $140, is treated as reasonable, starting only once rent has been unpaid two full days after the due date. A fee above $140 would have to be justified by the owner’s uncertain damages from the late payment.
Example a made-up Maine unit rents for $1,500. Four percent is $60. The owner can charge up to $60, but only once rent is more than 15 days late.
How to set a late fee you can enforce
- Look up your state’s statute and any city rule for the property. Use the strictest one.
- Write the due date, the last day without a fee, and the exact fee (a dollar amount or a percent of monthly rent) in the lease.
- Pick one simple fee. A flat amount is easier to explain and to defend than a daily fee that keeps growing.
- Apply it the same way to every tenant. Waiving it for some and not others invites disputes.
- Record the fee separately from rent in your books. In Oregon, for example, a landlord may not deduct an old late fee from the next rent payment to make that payment late (ORS 90.260(4)).
- Keep the fee out of any notice that demands only rent, unless your state allows it. Oregon says nonpayment of a late fee alone is not grounds to end a tenancy for nonpayment of rent.
What happens if your fee breaks the rule
Consequences vary. In New York, RPL 238-a makes any lease clause that waives its limits void. A judge reviewing an eviction may also refuse to award a fee that breaks the statute.
The safest habit is to treat your late fee as a reminder, not a source of income. If you are not sure your fee is lawful where your property is, ask a local attorney before you charge it.
How DoorKeeping handles it
In DoorKeeping, each tenant pays your own bank with a memo like 12B SMITH and an exact amount, which makes a late or short payment easy to spot. Charging any late fee is a money step, so it waits for your one-tap approval. DoorKeeping does not give legal advice; it records the fee you set, so check it against your state’s rule first.
Sources
- Texas Legislature, S.B. 1414 (86th Legislature), enrolled text amending Property Code 92.019, read Oct 29, 2026
- New York Real Property Law 238-a, read Oct 29, 2026
- Oregon Revised Statutes chapter 90 (ORS 90.260), read Oct 29, 2026
- Maine Revised Statutes, Title 14, section 6028, read Oct 29, 2026
- Massachusetts General Laws chapter 186, section 15B, read Oct 29, 2026
Questions
- How much can a landlord charge for late rent?
- It depends on the state. New York caps it at the lesser of $50 or 5 percent of monthly rent, Maine at 4 percent, and Texas treats up to 10 percent as reasonable for buildings with more than four units. Many states have no fixed number but require the fee to be reasonable.
- Does a late fee have to be in the lease?
- In many states, yes. Texas and Oregon both require the fee to be in a written lease or rental agreement before it can be charged.
- Can I evict a tenant for not paying a late fee?
- Rules vary. Oregon says nonpayment of a late charge alone is not grounds to terminate for nonpayment of rent, though it can support termination for cause. Check your state before relying on unpaid fees.