Authored By: Texas RioGrande Legal Aid
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A landlord can charge a reasonable late penalty fee if you pay rent after the first day after the due date in your lease agreement, but only if the fee is in your lease. If you do not pay your rent after the first day after the due date (or within any applicable grace period), the landlord usually has the discretion to either terminate the lease agreement or accept the rent and the late fee. If you offer to pay the rent and late fee and the landlord refuses to accept it, you may still have a chance in court if your lease provides for notice and time within which to cure a violation of your lease. A court may also consider your rent to be paid on time if you have established a clear and undisputed pattern of acceptance of late payment by your landlord. You should argue that if your landlord no longer wished to accept late payments, your landlord should have given you some advance notice. If you suspect that your landlord may refuse to accept your rent, be sure to offer the money in person and with a witness (not just over the telephone) so that you can later show in court that you attempted to pay rent.
Although there are no specific legal limits on late fees, they must bear some reasonable relationship to the actual costs incurred by the landlord as a result of the late payment. For example, if the landlord's costs as a result of the late payment are $15 and the landlord charged $150 as a late penalty, that could be ruled an unenforceable penalty. A court may also refuse to evict a tenant if the only alleged violation is that the tenant refused to pay an unreasonable late fee.