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DCrane Law
DCrane Law, Lawyer
Category: Real Estate Law
Satisfied Customers: 25285
Experience:  many years of experience representing clients in real estate matters
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WHAT IS A FAIR AND RESONABLE RENTAL LATE FEE IN TEXAS

Resolved Question:

WHAT IS A FAIR AND RESONABLE RENTAL LATE FEE IN TEXAS?
Submitted: 6 years ago.
Category: Real Estate Law
Expert:  DCrane Law replied 6 years ago.

Thank you for the post, Texas law does not place a limit on late fees, but imposes a reasonableness standard ("reasonable estimate of uncertain damages to the landlord that are incapable of precise calculation that result from late payment of rent". Section 92.019, Property Code.

 

The late fee must be based on some damage to the landlord -- that is key. If a landlord has not been harmed at all, then no fee should be allowed. If there is a $50 fee for being late (past the grace period), that might be acceptable depending on the amount of the rent, what the landlord has to do each month to collect rent from tenants, how much it costs the landlord for tenants to pay late, and other factors.

 

If a judge were to agree that the fee is too high, you are entitled to $100, three times the amount of the illegal fee charged, court costs and attorney fees.

Customer: replied 6 years ago.
My rent is $1500 a month, due on the 3rd.(no grace period!?). On the 4th it's a $25 late fee and $10 every day after that. These fees do not stop compiling untill rent and all late fees are paid in full. So if you're 20 days late the late fee is $215, making my payment $1715. if I could only pay $1600 the fees would keep adding up and would not stop untill i paid in full ther daily changing(growing) balance. Does this seem fair and reasonable?
Expert:  DCrane Law replied 6 years ago.

No, this structure does not seem reasonable because it is unlikely the landlord is incurring a $10 day penalty for each day the rent is late.

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