Late rent is the most common problem landlords face. California law lets you charge a late fee, but only within limits set by court decisions rather than a fixed number. Here is how to set one and what to do when the rent doesn't arrive.
Late fees: no fixed cap, but real limits
California has no statute that sets a maximum late fee for residential rent. Instead, a late fee is treated as liquidated damages under Civil Code 1671. In residential leases, such a fee is generally void unless it was a reasonable estimate of the landlord's actual losses from late payment, at a time when those losses would be hard to calculate. In Orozco v. Casimiro (2004), a court refused to enforce a late fee that the landlord couldn't show was based on a reasonable estimate.
In practice:
- Put the late fee in the written lease. You can't add one later without the tenant's agreement.
- Keep it modest and tied to real costs, such as the time spent following up, bank charges and the cost of your money arriving late.
- Write the lease clause as an estimate of those costs, and avoid daily fees that keep growing.
- Never include late fees in a 3-day notice to pay rent or quit.
Grace periods
State law doesn't require a grace period. The lease decides when rent is late. Many California leases give 3 to 5 days before a late fee applies. Some cities have their own rules, so check locally.
Fill in California rental forms
Rental agreements, 3-day notices to pay or quit, notices of entry, receipts and more, filled in from your property details.
See documents →Bounced payments and payment methods
- Returned payment fee: up to $25 for the first bounced check and $35 for each one after that (Civil Code 1719).
- Payment methods: a landlord must let tenants pay by at least one method other than cash or electronic funds transfer. Cash-only can be required for up to three months after a payment bounces, with written notice (Civil Code 1947.3).
- Receipts: give a receipt when rent is paid in cash.
When rent is late
- Reach out first. A short, friendly reminder the day after the grace period ends often solves it. Automatic reminders help.
- Talk about a plan. If the tenant has a short-term problem, a written payment plan can cost less than an eviction.
- Serve a 3-day notice to pay rent or quit if it remains unpaid. Then follow the eviction process only if needed.
Getting the 3-day notice right
Under CCP 1161(2), the notice must:
- State the exact amount of rent due, with no late fees, utilities or other charges added unless the lease defines them as rent. Many attorneys recommend demanding only the past 12 months of rent.
- Give the name, phone number and address of the person to pay, and the days and hours they accept payment in person, or bank details, or the electronic payment method already in use.
- Count 3 court days, not counting Saturdays, Sundays or court holidays.
- Following the 2025 Eshagian v. Cepeda decision, state when the notice was served and when the period ends.
An overstated or vague notice can get an eviction case dismissed, so double-check every number.
Ask Tello about California rental rules
Tello, the AI assistant inside EC Rental, knows California rental law and your account, and points you to the rule behind each answer.
Meet Tello →Last checked October 2026. This guide is general information, not legal advice. Laws change and local rules can be stricter, so check the current law or ask a California landlord-tenant attorney before acting.