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As I understand the term usury: it is the action or practice of lending money at unreasonably high rates of interest.

Are unreasonable late fees prosecuted as usury? Is there mother term?

If a concrete example is needed for an answer: assume a Florida commercial lease / rent with a late fee of 1% per day.

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This is covered by the Tenant Fees Act 2019. This act caps any late fees for a tenancy to 3% above the Bank of England rate.

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  • Thank you for answering: your comment has reminded me that I failed to include a jurisdiction.
    – gatorback
    Commented Jun 25, 2023 at 10:34
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Florida law recognizes a concept of "usury"

All contracts for the payment of interest upon any loan, advance of money, line of credit, or forbearance to enforce the collection of any debt, or upon any obligation whatever, at a higher rate of interest than the equivalent of 18 percent per annum simple interest are hereby declared usurious.

Late fees are liquidates damages, not interest on a loan, so this law is irrelevant. Violation of the prohibition against usury is criminally prosecutable, under §687.146.

Instead, late fees have a separate potential limit under §83.808, which declares that a landlord "may charge a tenant a reasonable late fee for each period that he or she does not pay rent due under the rental agreement", and also declares that "a late fee of $20, or 20 percent of the monthly rent, whichever is greater, is reasonable and does not constitute a penalty", plus it allows collecting reasonable enforcement expenses, which are not defined. The law does not prohibit late fees greater than 20% or declare them to be penalties, it simply does not statutorily declare them to be reasonable, in which case the court must assess whether the fee is reasonable. The landlord would have to shoulder a substantial burden to prove that a fee above 20% is reasonable. Assuming, for example, a 25% late fee (and not including separate collection fees), and assuming that the landlord failed to convince the court that the fee is in fact reasonable, the courts would limit the fee to what it deems to be reasonable, and there cannot be criminal prosecution of the landlord for having such a clause in the lease.

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  • The case law (and sometimes consumer credit statutes setting maximum interest rates) generally treats late fees which are not authorized by statute as interest. A late fee of 1% per day, rather than a one time late fee in accordance with a default, would almost surely be held to be interest by another name and declared to be usurious.
    – ohwilleke
    Commented Jun 27, 2023 at 0:56
  • @ohwilleke. Always good to hear hear from you. Please consider posting a separate answer with citations instead of a comment?
    – gatorback
    Commented Jun 28, 2023 at 11:26

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