Texas Senate Bill SB716

Texas 2009 - 81st Regular

• Out of Senate Committee: 4/8/09

Caption

Relating to late fees under a residential lease.

Impact

The introduction of SB716 is aimed at providing clarity and protection for tenants regarding late fees associated with their rent payments. This bill addresses complaints from tenant advocacy groups about excessive late fees. By legalizing only reasonable late fees that are disclosed in lease agreements, it ensures that tenants are not subject to surprise charges that could be deemed punitive rather than compensatory.

Summary

SB716 amends the Property Code of Texas relating to the imposition of late fees under residential leases. The bill specifies conditions under which landlords can charge tenants a late fee for not paying rent on time. Under the new provisions, landlords must include any late fees in the written lease agreement. Additionally, the late fee must represent a reasonable estimate of uncertain damages caused by the late payment, which cannot be precisely calculated, and it can only be assessed if the rent remains unpaid for a full day beyond the due date.

Contention

While the bill has the intention of safeguarding tenant rights, it may face contention from landlords who might argue that these restrictions could limit their ability to enforce the terms of their leases effectively. There could be concerns that the definition of 'reasonable estimate' might vary significantly between landlords and tenants, potentially leading to disputes. Additionally, enforcing these stipulations may require further legislative clarity on other related landlord-tenant issues.