I will try and explain how late fees work - First the late fee program is NOT very good.
The late fees are set to post a late fee if the current month rent is not paid on the 5th of the month, then a 1.00 late fee for any day after that.
Why would late fees be charged incorrectly:
If the resident owes a lot of older rent charges and you add their current rent payment on time - but you apply it to older rent charges instead of the current month then a late fee will be charged.
See attached Prevent Late fees from billing for tenants with a zero balance on the ledger