LATE PAYMENTS AND DEFAULTS

Many states have laws limiting the amount of fees that can be charged for late rental payments. For example, California and Oklahoma prohibit pre-set late fees. Massachusetts and Montana disallow late fees unless the rent is at least 30 days late. Others limit the late fee to a percentage of the rent, for example 4 percent. It is RECOMMENDED that you check with an attorney regarding the limits imposed by your state.

Each state has specific requirements that must be followed in order to properly terminate the Lease because of a default by one of the parties. Perhaps the most frequent default is the Tenant's failure to promptly pay the rent. In order to terminate the lease for nonpayment of rent, the Landlord must strictly comply with state-specific procedures, including the content and timing of required notice to the Tenant. Failure to do so may result in a delay in obtaining an eviction, and/or it may jeopardize the Landlord's right to recover rent or reimbursement for damages to the Premises.

Landlords must also be careful that their actions in terminating a lease or evicting a Tenant do not constitute retaliatory actions against the Tenant for exercising the Tenant's legal rights. For example, the Landlord may not evict the Tenant simply because the Tenant called the local housing authority regarding a safety problem on the premises. Most states have specific laws that allow Tenants to obtain money damages from Landlords who engage in retaliatory actions or presume a retaliatory motive for a period of time after the Tenant's act.

DEFAULT

State laws vary widely regarding the number of days that a Tenant will have to correct (or cure) a default after receiving notice of such default from the Landlord. Further, some states provide different periods to cure depending on the type of default, distinguishing between the failure to pay rent on time and all other defaults. For example, a Landlord may be entitled to take repossession of an apartment seven days after notifying the Tenant about missing a rent payment, but may have to wait 30 days if the complaint involves the Tenant's failure to keep the Premises clean. It is highly advisable that you check with your local housing authority about the length of time that must pass before taking steps to regain possession after serving any notice of default.