Everything freelancers and small businesses need to know about charging late fees, interest rates, and collecting overdue invoices in North Dakota.
This information is provided for general educational purposes only and does not constitute legal advice. Laws change frequently. Consult a licensed attorney in North Dakota for advice on your specific situation. Last reviewed: 2026.
Usury laws cap the maximum interest rate that can be charged on overdue payments in North Dakota.
6% default; higher for written commercial
North Dakota's default rate is 6% (N.D.C.C. § 47-14-05). Written contracts may specify higher rates for commercial transactions.
Written commercial agreements may specify higher rates. Banks and licensed lenders are exempt.
Understanding what you can and cannot charge for late payments in North Dakota.
Late fees are allowed when contractually agreed. Written commercial agreements have flexibility.
No specific cap for written commercial agreements.
Standard contract law principles.
North Dakota Prompt Payment Act sets deadlines and penalties for late payments in North Dakota.
30 days for state contracts.
Interest on late payments.
North Dakota requires state agencies to pay within 30 days under N.D.C.C. § 48-01.2-15.
Certain industries in North Dakota have additional rules around payment timelines, liens, and collection procedures.
Construction: N.D.C.C. § 35-27 requires mechanics' lien filing within 90 days.
Government contracts: 30-day payment with interest penalties.
Energy: North Dakota's oil industry (Bakken) follows standard commercial terms.
Use this compliant wording on your invoices to clearly communicate your late fee policy in accordance with North Dakota law.
Payment is due within 30 days. A late fee of 1.5% per month (18% per annum) will be assessed on unpaid invoices. Written commercial agreements in North Dakota may specify any rate (N.D.C.C. § 47-14-05).
This wording works because it clearly states the rate, when it applies, and references North Dakota legal standards. Always ensure your stated rate complies with North Dakota's usury limits.
Practical tips for invoicing within North Dakota's legal framework.
Before you can charge a late fee in North Dakota, your client needs to have agreed to the terms. Include your late fee clause directly on your invoice and in your contract.
North Dakota caps interest rates at 6% default / higher for written commercial. Charging above this limit can void your right to collect interest entirely and may expose you to penalties.
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Compare North Dakota's rules with neighboring and commonly referenced states.
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