Arkansas late fees?

Question

As I understand AR state law, there's a 5-day grace period for rent payments but beyond that I can set due dates and late fees as I like. What's new for me is the idea that landlords can choose to assess a one-time late fee (and is that a fee or "additional rent" as I've heard some call it?) AND they can add a per-day fee on top of that. I was even more surprised that some leases include a late fee that's a percentage of the total rent. 5% might not sound like much until I consider the rent amount involved. Market rates for rentals like mine are $1300-$2,000.

What do you consider reasonable? I have a few weeks left to update my lease before I market the property again.

Susan H. · Answer

Thank you Jacob. I'm leaning toward a flat late fee rate of  5% payable if the tenant does not pay by the 5th of the month.

Jacob White · Answer

Susan, be aware that Arkansas law considers fees as interest.  The usury limit is 17%.

Susan H. · Answer

Thanks Greg.

Nancy Curran · Answer

Susan, local law could be different from state law. I would check with a local real estate atty. the last thing you want is to charge reasonable fees only to find out what you consider reasonable is not legal. And that could become an issue if/when you need to take legal action/eviction.

Susan H. · Answer

Nancy, I cannot find any state or local laws limiting late fees. It appears to be at the landlord's discretion.

Thomas S. · Answer

What I consider reasonable is to give a tenant a warning the first time they pay late and if they do it a second time evict, assuming your state regulations allow and to evict otherwise do not renew the lease when it ends.

Nancy Curran · Answer

It's all about the law. And charge late fees to the maximum what you are allowed. To me, reasonable doesn't matter inasmuch as following local laws matter.

Arkansas late fees?

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