Residential Late Fees - Current New York Limits

Overview

New York Real Property Law §238-a applies a statewide statutory rule to residential late fees. A landlord may not demand a late fee unless rent has remained unpaid for five days after it was due. The fee may not exceed $50 or 5% of the monthly rent, whichever is less.

The statutory ceiling applies to residential tenancy agreements and is not limited to rent-stabilized apartments.

Practical Application

• Put any late-fee term in the written lease.
• Do not demand the fee before the statutory five-day period has passed.
• Charge no more than the lesser of $50 or 5% of monthly rent.
• Do not describe a lease clause as permission to exceed the statute.
• Keep the rent due date, payment date, fee calculation, notice, payment, and any waiver in the tenancy record.
• Ask counsel how the rule applies to a disputed balance or court proceeding; Botway does not collect or litigate late fees.

For $2,000 monthly rent, 5% is $100, so the statutory maximum is $50. For $900 monthly rent, 5% is $45, so the statutory maximum is $45. These are arithmetic illustrations of the statutory formula.

Frequently Asked Questions

Is the cap different for a market-rate apartment?

No separate, higher market-rate ceiling appears in §238-a's residential late-fee rule.

Can a lease authorize a higher amount?

No. Section 238-a states that no late fee may exceed the lesser of $50 or 5% of monthly rent.

Does Botway assess or collect the fee?

No. Rent collection and enforcement remain with the owner or property manager, with legal questions routed to counsel.

Verified Source

• New York Senate, Real Property Law §238-a - fetched and read 2026-08-07.

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This article provides general educational information only and is not legal advice. Counsel should address disputed charges and enforcement.