Question:

A late payment during grace period – is it really late?

Answer:

No. A late payment in the grace period is not badly late with a conventional mortgage loan. However, a late payment on an auto loan could lead to repossession of the car.

Mortgage loans allow for a 15 day late payment in the grace period and the payment won't be considered late. A 30 day late payment is not within the grace period and will be reported to the credit bureaus but won't really hurt your credit. A late payment more than 60 or 90 days late will damage your score, though. Also, late fees begin right after the 15 day grace period is over, even if you are not 30 days late, yet.

However, the mortgage company may start calling you once you are past the due date. The reason is they take every measure to make sure your payment will arrive. To avoid receiving late payment grace period calls, call your lender first, if you know they practice phone calling shortly after the due date. Talk to the collections department to put the phone calls on hold for several days, and pay by phone. They will charge you a fee but at least the phone calls will be avoided, and you won't be too late.

However, a grace period is just the time before late fees are incurred. The mortgage company will call, though, to remind you of being late.

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