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Monetary Penalty
May I charge a monetary penalty on a monetary payment?
It is unlawful to charge a monetary penalty on any form of monetary payment (e.g. fees for late rental payments, car payments, loan installments, etc.), though it is permissible to enter into a separate parallel contract beforehand whereby the one paying late is legally compelled to give money to a specified charity in the event of late payment, thereby fulfilling the lender's need to create a deterrent.

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