New Jersey late fee law

6%per year

Attaches to the debt by operation of law when you agreed no rate, so it accrues before any lawsuit and can be stated on a demand letter.

The general legal rate is 6% per annum ($6 per $100 forborne per year) when no written contract fixes a rate; where a written contract specifies a rate, up to 16% per annum may be taken. Statute text corroborated via FindLaw and multiple NJ practitioner sources (official njleg site not directly fetchable this session). Prejudgment interest on contract claims in litigation is set by court rule rather than this statute - verify current rule mechanics with counsel.

Written contracts may fix a rate up to the 16% civil usury cap for individuals. Loans to corporations, LLCs, and LLPs are exempt from the civil usury statute and such entities cannot plead the defense of usury (N.J.S.A. 31:1-6) - so agreed rates on true B2B entity credit are effectively not capped by Title 31. A lender charging above the applicable civil cap forfeits all interest. Secondary sources also note criminal-usury ceilings and other exemptions (e.g., larger business loans); those specifics were not verified against statute text this session - verify with counsel.

public+private-construction

NJ Prompt Payment Act (construction contracts, private and public owners): once a payment due under the Act is not timely made (prime contractor paid per the Act; subs and sub-subs must be paid within 10 calendar days of the higher tier's receipt of payment), the delinquent party owes the amount due plus interest at the prime rate plus 1%, running from the day after the required payment date; the prevailing party in a collection action is awarded reasonable costs and attorney fees. Separate prompt-payment provisions for State purchases of goods/services exist (N.J.S.A. 52:32-32 et seq.) but were not verified in detail this session.

No NJ statute specific to flat late fees on ordinary commercial invoices was found; agreed late fees are enforceable if they are a reasonable liquidated-damages estimate and not a penalty. Large flat charges on non-entity debtors risk recharacterisation as interest subject to the 6%/16% caps; entity debtors cannot plead civil usury.