Penalized For Being a Little Late With the Rent--48 Times
Question: I have just vacated a house that I rented in Los Angeles for eight years. The landlord has refused to refund any of my $2,000 security deposit because of late charges accrued during my tenancy.
The signed lease agreement stipulates a 5% penalty for payments more than 10 days late. My rent was $2,000 a month. The owner claims that I was more than 10 days late 48 times, so the 5% late fees total $4,800 (48 times $100 equals $4,800). The landlord has generously agreed to forgive the extra $2,800 in late fees.
Is this legal? I admit that when I was paying late he would occasionally call me to inquire about the rent, but he never once mentioned a late charge until now.
Answer: As you say in your letter, "The signed lease agreement stipulates a 5% penalty for payments over 10 days late." I assume that you signed the lease, and that's the bottom line, the written agreement. The owner is not required to verbally remind you of the penalty when he calls you on the phone.
Because you don't seem to dispute that the rent was late by 10 or more days 48 times, technically you owe the $4,800 in late fees. Although the landlord probably would have to sue you in Small Claims Court to collect the balance of them, you should actually thank him for forgiving you the obligation to pay them.
Though something like a 25% late fee would doubtless be considered usurious, and illegal, 5% would not. It is a legal fee that you agreed, in writing, to pay.
Maximum Charge for a Deposit
Q: I recently inquired on a house in Orange. The owner requested a deposit of $2,000, and first and last months' rent (rent per month is $1,750) for a grand total of $5,000. Is this a bit excessive?
A: Assuming that the house is unfurnished, the maximum the owner can collect is $5,250, the first month's rent plus two additional months' rent (three times $1,750). The two added months of rent can be called last month's rent or security deposit, but the state of California defines it all as "security deposit," regardless of how the owner labels it.
Your letter says that the owner is collecting $5,000--a $2,000 deposit, plus the first and last month's rent (2 times $1,750 equals $3,500) for a total of $5,000. As you know if you did the math, $2,000 and $3,500 is $5,500, not $5,000, so somebody's math is flawed. You may want to look into that.
In any event, if the total being charged is $5,000, and the rent is $1,750, the owner is $250 less than the legal maximum.
