The most important source of information about a residential tenant’s rights and a landlord’s responsibilities is the written lease agreement. Some landlords prefer oral agreements, but it is more common for them to require the tenant's signature on a written lease—and a written lease protects the tenant more than an oral agreement. Be sure to read the lease carefully before you sign it.

A residential landlord’s ability to charge late fees generally depends on the specific language in the written lease agreement; the state’s landlord-tenant laws that may limit the amount of late fees the landlord can charge and the circumstances in which they can be charged; and the state's contract law.

Contract law in most states recognizes an implied duty of good faith and fair dealing between parties to a contract, and a residential landlord who charges late fees because the tenant is an hour late paying the rent may be in breach of the landlord’s implied duty of good faith and fair dealing—unless, for example, the lease agreement specifies an hour (12:00 p.m.) of the day by which rent is due and states that time is of the essence.

In Washington State, the Residential Landlord-Tenant Act (RCW 59.18) is the primary source of law governing the relationships between landlords and tenants. While a written lease agreement is not mandatory, it is highly recommended as it provides a clear record of the terms agreed upon by both parties. A written lease offers more protection for tenants as it typically outlines the rights and responsibilities of each party in detail. When it comes to late fees, Washington law allows landlords to charge them as specified in the lease agreement. However, these fees must be reasonable and related to the actual costs incurred by the landlord due to the late payment. The lease must clearly state the amount of the late fee, the conditions under which it will be charged, and the grace period, if any, before the fee is applied. Additionally, under the implied duty of good faith and fair dealing, which is recognized in Washington contract law, a landlord may not charge late fees in a manner that is arbitrary or unfair, such as charging a late fee for rent that is only an hour late without a specific provision in the lease stating that time is of the essence. Tenants should carefully review their lease agreements before signing to understand their obligations and the potential consequences of late payments.