Operative Text
A. Paragraph 6-23 does not apply to cooperatives. Cooperatives may collect any
late charges that are approved by the Board and that are consistent with the
cooperative’s organizational documents and state and local laws.
B. Paragraph 6-23 does not apply to Section 202/8, Section 202 PAC, Section 202
PRAC and Section 811 PRAC projects. Owners of Section 202/8, Section 202
PAC, Section 202 PRAC and Section 811 PRAC projects cannot charge fees for
late payment of rent.
C. Owners may assess a charge if the tenant has been given at least 5 calendar
days as a grace period to pay the rent. The rent must be received by the fifth
day, not postmarked by then.
On the sixth day, the owner may charge a fee, not to exceed $5 for the period of
the first through fifth day that the rent is not paid. Additionally, the owner may
charge a fee of $1 per day for each additional day the rent remains unpaid for the
month.
D. Field Offices or Contract Administrators may approve a higher initial late fee if:
1. It is permitted under state and local laws;
2. It is consistent with local management practices; and
3. The total late charge assessed for the month does not exceed $30.
E. An owner may deduct accrued, unpaid late charges from the tenant’s security
deposit at the time of move-out, if such a deduction is permitted under state and
local laws.
F. An owner must not evict a tenant for failure to pay late charges.HUD Handbook 4350.3 REV-1 CHG-4 § 6-23 establishes a structured framework for how late rent charges may be assessed in covered federally assisted housing. After a mandatory grace period of at least five calendar days, a landlord may charge an initial fee of up to $5, followed by up to $1 per day for each additional day rent remains unpaid, with a monthly cap that generally does not exceed $30. Certain project types—including Section 202 PAC, Section 202 PRAC, and Section 811 PRAC—are entirely exempt from late fees, and no tenant may be evicted solely for failing to pay a late charge.
Plain English — not legal advice.
Operators of covered HUD-assisted properties subject to § 6-23 generally maintain a documented late-fee schedule that reflects the five-calendar-day grace period, the $5 initial fee structure, and the $1-per-day accrual rule. Compliant operators confirm whether their project type falls under an exemption—such as Section 202 PRAC or Section 811 PRAC—before assessing any late charges at all. Operators seeking a higher initial fee work through their Field Office or Contract Administrator to obtain written approval, ensuring the total monthly charge stays within the $30 ceiling and that any security deposit deductions for unpaid late charges are permitted under applicable state and local law.
General guidance for property managers — not legal advice for your specific situation. Consult an attorney for advice on your case.
Tenants living in HUD-assisted housing covered by § 6-23 have a right to at least a five-calendar-day grace period before any late fee can be charged, and the fee structure is capped by federal guidelines. Residents of Section 202 PAC, Section 202 PRAC, or Section 811 PRAC properties are entitled to know that late fees are prohibited entirely for their project type under § 6-23. Tenants who believe a late fee has been improperly assessed—or who face an eviction threat based solely on unpaid late charges, which § 6-23 expressly prohibits—may consider contacting the U.S. Department of Housing and Urban Development, a local HUD Field Office, or a tenant-rights organization to understand available options.
General guidance for tenants — not legal advice for your specific situation. Consult a tenant-rights organization or attorney for advice on your case.
Generated October 14, 2026 — auto-generated, not yet human-reviewed. See /transparency for methodology.
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