Vermont late fee law

12%per year

We have not been able to confirm whether this figure is a contract-silent default, a litigation-only rate, or a ceiling. Do not rely on it without counsel.

9 V.S.A. § 41a(a) ('Legal rate of interest') provides that except as specifically provided, the rate of interest or sum allowed for forbearance or use of money shall not exceed 12% per annum (actuarial method) - this functions as both the general legal rate and the usury ceiling. Interest on judgments is likewise 12% per annum (12 V.S.A. § 2903). Verified via FindLaw's statute reproduction corroborated by Justia and Vermont Legislature search listings; the official legislature.vermont.gov site returned a TLS certificate error and could not be fetched directly - verify with counsel. Rate type not classified: 9 V.S.A. § 41a(a) is phrased as a ceiling ('shall not exceed 12%') and the recorded research notes it functions as both the general legal rate and the usury ceiling. Whether 12% ACCRUES on a silent contract or merely caps an agreed rate is not resolved by the recorded text. Verify with counsel before relying on this figure.

Parties may agree to interest up to the 12% general cap of 9 V.S.A. § 41a(a); § 41a(b) lists numerous higher category-specific ceilings (e.g., retail installment contracts 18%/15%, retail charge agreements 21%, certain installment loans up to 24%/18% APR, negotiated rates for bank revolving credit). No broad corporate/commercial-borrower exemption from the cap was verified in this research - verify with counsel before relying on any rate above 12% in a B2B contract.

public+private-construction

Vermont's Prompt Payment Act (9 V.S.A. ch. 102, §§ 4001-4009) covers construction contracts (applied to private projects and generally to public construction; it is not a general trade-invoice statute). Owner payment is due within 20 days of the end of the billing period or of invoice delivery, whichever is later; delayed progress or final payments accrue interest from the 21st day at the rate established by 12 V.S.A. § 2903(b) (12% per annum) (9 V.S.A. § 4002(d)). Amounts wrongfully withheld can attract an additional 1% per month penalty, and the substantially prevailing party in an action may recover attorney fees.

No distinctive Vermont statute on flat late fees for commercial invoices was found; default principles apply (enforceable if agreed and reasonable, subject to the liquidated-damages/penalty doctrine). Note that because 9 V.S.A. § 41a caps charges for the 'forbearance or use of money' at 12% for most transactions, recurring percentage late charges on B2B invoices exceeding that rate carry usury-recharacterization risk - verify with counsel.