North Carolina Tenant Rights, Chapter 42 and the 5%/$15 Late Fee Rule
North Carolina residential landlord-tenant law sits in Chapter 42 of the North Carolina General Statutes. Chapter 42 caps late fees, sets deposit rules, and specifies termination notice periods.
Chapter 42 overview
- N.C.G.S. 42-14, termination notice.
- N.C.G.S. 42-46, late fee cap.
- N.C.G.S. 42-50 to 42-56, security deposits.
- N.C.G.S. 42-25.7 et seq., eviction procedure.
Late fee cap at 42-46
N.C.G.S. 42-46 caps late fees at the greater of 5% of the monthly rent or $15. The cap applies to each month separately. A landlord who charges more than the greater of 5% or $15 is in violation.
Late fees cannot be charged before the grace period ends (usually 5 days, lease-specified).
Security deposit rules at 42-50
N.C.G.S. 42-50 requires:
- The deposit must be placed in a trust account at an in-state federally regulated bank.
- The landlord must disclose the bank name to the tenant within 30 days.
- The deposit cannot exceed 2 weeks' rent for week-to-week, 1.5 months' rent for month-to-month, or 2 months' rent for longer terms.
Return deadline is 30 days after move-out with itemized statement.
Termination notice under 42-14
N.C.G.S. 42-14 sets default notice periods:
- 2 days for week-to-week.
- 7 days for month-to-month.
- 1 month for year-to-year.
These can be modified by lease.
Where to get a North Carolina lease
LeaseKit's North Carolina residential lease template includes the 42-46 late fee cap, 42-50 deposit rules, and 42-14 notice periods. $29 one-time.
This post is informational. North Carolina tenant law is rent-technical. For contested cases, consult a North Carolina-licensed attorney.