There are two questions inside every late-fee clause, and most leases only answer one. How much is the fee, and when may you charge it. Get the second one wrong and the first one stops mattering, because a fee charged a day early is not a smaller fee — it's an unlawful one.
Across the eleven states we cover, only four jurisdictions put a number on the fee. Two require you to wait five days before charging anything. Everywhere else the rule is the same sentence with different case law behind it: it has to be in the lease, and it has to look like a cost rather than a punishment.
What each state actually caps
| State | Cap on the late fee | Grace period before you can charge |
|---|---|---|
| Arizona | No fixed cap — must be reasonable and in the lease | Not required by statute |
| California | No fixed cap — enforceable only as liquidated damages | Not set by statute |
| Florida | No statutory cap — reasonable and in the lease | Not required by statute |
| Georgia | No statutory cap — reasonable and in the lease | Not required by statute |
| Illinois | None statewide — Chicago: $10 on the first $500 + 5% of the rest | Not set by statute |
| Louisiana | No statutory cap | Not required by statute |
| New York | Lesser of $50 or 5% of monthly rent | 5 days, mandatory |
| North Carolina | Greater of $15 or 5% of monthly rent | 5 days, mandatory |
| Ohio | No statutory cap — reasonable and in the lease | Not required by statute |
| Pennsylvania | No statutory cap — reasonable and in the lease | Not set by statute |
| Texas | 12% of rent (≤4 units) · 10% (>4 units) | Rent must be 2 full days late |
"Not set by statute" and "not required by statute" are doing different work. In Arizona, Florida, Georgia, Louisiana and Ohio the state guides record explicitly that no grace period is required. In California, Illinois and Pennsylvania the statute simply doesn't speak to it — which is not the same as a court agreeing that a fee on day one is reasonable. Your lease sets the trigger day in all eight, but a same-day fee is the least defensible version of it.
Four places with a real formula
Texas is the most prescriptive, and the most expensive to get wrong. Since the 2019 amendments to §92.019 a late fee must either be genuinely reasonable or fall inside the statutory safe harbour: 12% of monthly rent on a property with four or fewer units, 10% above that. It must be in the written lease, and it cannot be charged until rent has gone unpaid for two full days past the due date. An initial fee plus a daily fee is allowed, but the combined total is subject to the same ceiling. Charge outside it and the tenant recovers $100 per violation, three times the improper fee, and attorney fees. Leases written before 2019 are the usual source of violations — that clause is worth auditing today rather than at the next renewal.
North Carolina sets the fee by formula at the greater of $15 or 5% of the monthly rent (week-to-week: the greater of $4 or 5%), chargeable only once rent is five days late. One fee per late payment, it must be in the lease, and — this is the part that catches people — you cannot deduct it from the next rent payment to manufacture a fresh default. §42-46 also governs the eviction-adjacent charges landlords like to add: complaint-filing, court-appearance and second-trial fees are permitted only in the amounts and circumstances the statute lists.
New York caps the fee at the lesser of $50 or 5% of monthly rent, with no fee at all until payment is at least five days late. A clause exceeding that is void, not reduced to the legal maximum — there's no judicial trimming to save you. The same section caps application fees at $20.
Chicago is a city rule that beats the state's silence. Illinois preempts rent control and caps nothing statewide, but the RLTO fixes the late fee at $10 for the first $500 of monthly rent plus 5% of anything above $500. On $1,500 rent that is a maximum of $60, and charging more violates the ordinance no matter what the lease says.
What "reasonable" means in the other seven
The remaining states hand the question to contract law, and the test is consistently the same: a late fee is enforceable as a rough estimate of what the late payment actually costs you, and unenforceable when it reads as a penalty. California states it most explicitly — a late fee survives only as a liquidated-damages clause under Civ. Code §1671, and a fee a court reads as punitive is struck entirely, not reduced.
The practical range that shows up across these guides is narrow and worth knowing:
- Florida — flat $50–$100, or around 5% with a short grace period
- Georgia — the same, commonly triggered on the 5th
- Ohio — about $50 flat, or roughly 5–10% after a short grace period
- Pennsylvania — flat or roughly 5% after a short grace period
- Louisiana — 5–10% with a 3–5 day grace period is routinely enforced
- Arizona — around 5% has been accepted; daily fees are enforceable where the total stays reasonable
- California — low single digits with a grace period is what gets sustained
Two traps sit inside that list. Arizona's daily-accruing fees are fine until they compound into a meaningful share of the rent, at which point the whole clause invites a penalty finding. And Ohio adds a rule about how you apply money: a tenant's rent payment should be credited to rent. Steering it to fees first so the rent reads as unpaid is a losing argument in an eviction.
The mistake that voids a legal fee
Say you own a six-unit building in Texas. Rent is $1,400, due the 1st. Your lease says a $75 late fee applies "if rent is not received by the due date."
The amount is fine — 10% of $1,400 is $140, so $75 is comfortably inside the cap for a property over four units. The trigger is not. Texas bars any late fee until rent has been unpaid for two full days, so a fee charged on the 2nd is unlawful even though the number is legal. That's $100 plus three times $75 plus the tenant's attorney fees, for a clause that was only wrong about a date.
The same shape catches people in New York and North Carolina, where the five-day wait is mandatory and a lease saying "late after the 3rd" is unenforceable on its face.
A late-fee clause that exceeds the statute is not quietly reduced to the legal maximum in most of these states — in New York it is void, and in California a penalty clause is struck in full. The downside isn't collecting less than you hoped. It's collecting nothing and paying the tenant's costs.
A workflow that makes this boring
The failure here is almost never the statute. It's that the fee lives in a lease template someone wrote years ago, in a state whose rules have since changed, and nobody re-reads a clause that has never caused a problem yet.
Two habits fix it permanently. Audit the clause per state, not per portfolio — one template across several states guarantees it's wrong somewhere, and Texas's 2019 change is the live example. Let the system apply the fee, so the trigger day comes from the lease terms rather than from whoever is doing collections that week. Corbica applies late fees from the lease's own terms and books them to the ledger, which means the trigger date is consistent and there's a record of when the fee was assessed and why. Any system that reliably refuses to charge a fee on day one beats a careful person doing it by hand.
The short version
- Only four jurisdictions put a number on the fee: Texas, North Carolina, New York, and Chicago.
- Only New York and North Carolina require a grace period — five days, both. Texas bars a fee until rent is two full days late.
- Everywhere else, "reasonable and in the lease" is the whole rule, and the market answer is 5% or $50–$100 after a short grace period.
- The trigger day voids more fees than the amount does.
- An over-cap clause is often void, not trimmed — you collect nothing.
Related reading
- Landlord-Tenant Laws by State — the statute and review date for every state above
- How Much Notice to Raise Rent — The Rules by State — the other number that rides on your lease dates
- Security Deposit Accounting — It's a Liability, Not Income — why an unpaid late fee isn't simply deposit money
General information, not legal advice. Statutes change and city ordinances routinely override the state rule — check your state page for the citation and the date we last reviewed it, or ask a local attorney before you rely on a fee clause you intend to enforce.