Adding a late fee policy and retroactive security deposit

[Kevin Phu]

I have a tenant that is a friend and former coworker who has been late on rent 4 times in the past 12 months. He has auto pay set up but due to some financial issues, the account sometimes has insufficient funds so his payment will bounce. When it does, he immediately takes care of it.

When I signed him on as a tenant, I did not collect a security deposit from him, nor did I include late rent fee policy in his lease. I want to keep him as a tenant for multiple reasons. I know he has a steady income in a very secure job. He's saving a lot of money renting from me which helps him because his ex-wife pretty much bankrupted him but he didn't want to file bankruptcy and his been doing a very good job getting back on his feet.

He is a no trouble tenant aside from the occasional late payments. Should I collect a retroactive security deposit from him and also add on a late fee policy to his lease? Is that even legal to do so? What advice do you guys have?