Colorado Late Fee Rules for Landlords: The Cap, the Grace Period, and What Not to Call It

Late fees are one of the easiest clauses to get wrong without noticing — a dollar figure set too high, a missing grace period, or wording that quietly changes how the fee is treated. Here is what Colorado law actually requires.

The cap: the greater of $50 or 5%

Colorado caps a late fee at the greater of $50 or 5% of monthly rent (C.R.S. § 38-12-105). On a $1,800 monthly rent, that means the cap is $90 (5%), not a flat $100 or 10% figure that some older or generic templates still use.

The seven-day grace period

A late fee cannot apply until rent is more than seven days late. A clause that charges a late fee the day after the due date — the 1st or 2nd of the month — does not meet the required grace period, regardless of the dollar amount.

Don’t call it “additional rent”

Some templates label the late fee as “additional rent” added to the balance due. That framing is specifically restricted under the statute and is worth rewriting even when the dollar amount itself is within the cap — the label matters, not just the number.

What this does — and doesn’t — cover

The cap and grace period apply specifically to late payment of rent. Other charges — admin fees, amenity fees, pet fees — are not governed by this specific cap, but they still need to be clearly itemized and disclosed rather than bundled into a vague “additional charges” line.

What to check in your own lease

• Does the late-fee amount exceed the greater of $50 or 5% of monthly rent?
• Does the clause allow a full seven days before the fee applies?
• Does the clause refer to the fee as “additional rent,” or as a separate charge?
• Are other fees (utilities, admin, amenities) clearly itemized rather than bundled?

The bottom line

A late-fee clause that exceeds the cap, skips the grace period, or mislabels the fee is one of the most common findings in an unreviewed template — and one of the easiest to fix. A Fee Compliance Check checks your late-fee and add-on charge language against the current rule.

LeaseCheck for Landlords is an educational lease-compliance screening tool. It is not a law firm and does not provide legal advice. Colorado rental laws change; confirm specifics for your situation with a licensed attorney.