Maryland Tenants Gain New Protections Against High Late Rent Penalties

Maryland renters will soon see new protections from steep late payment penalties, thanks to House Bill 273, which takes effect Oct. 1, 2025.

The legislation clarifies how landlords may calculate late fees on residential leases, tightening rules to ensure penalties reflect only unpaid rent rather than the entire monthly amount.

What HB 273 Says in Simple Terms

Under current law, landlords in Maryland are prohibited from charging more than five percent of the “rent due” as a late payment penalty.

The problem has been that “rent due” was often interpreted to mean the full rent amount, even if a tenant had already made a partial payment.

HB 273 addresses that ambiguity by making clear that the five percent cap applies only to the unpaid portion of rent. If a tenant pays part of their rent late, the late fee must be calculated on what remains unpaid, not on the full monthly rent.

The law also preserves an important exception for tenants who pay rent weekly.

In those cases, the maximum penalty remains capped at three dollars per week, with a total limit of twelve dollars per month in late fees.

Furthermore, any lease clauses that impose penalties exceeding these limits will be unenforceable. If a landlord attempts to enforce an illegal clause, tenants have the right to recover damages as well as reasonable attorney’s fees.

Why This Law Matters

The changes in HB 273 are significant for tenants because they create fairer rules around late fees.

For example, if the monthly rent is one thousand dollars and a tenant pays eight hundred dollars, leaving two hundred dollars unpaid, the landlord will only be able to charge a late fee of five percent of the two hundred dollars, or ten dollars.

Under the older interpretation, the landlord might have tried to charge fifty dollars, which is five percent of the entire rent amount, even though most of the rent had already been paid.

By ensuring that late fees reflect only the actual balance owed, the new law discourages landlords from over-penalizing tenants who make partial payments.

Moreover, it protects renters who are making good-faith efforts to pay while still allowing landlords to enforce accountability for overdue amounts.

The law also requires landlords and property managers to revise their lease forms. Late fee provisions must now explicitly reference only unpaid rent and must stay within the statutory caps.

And any clause that violates the new rule will have no legal effect.

This gives both tenants and landlords greater clarity and consistency, removing confusion about what “rent due” means and reducing the risk of disputes.