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Late Payment Callers

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Posted On: 01/29/2014

Question:

We have always paid our VA mortgage just before the third Wednesday of the month, since that's when the bulk of our money arrives. I have always added the extra interest with payment whether it fell on the 16th or after. This is my question: Are the banks now forced by the government to start calling the mortgage holder from 8:00 in the morning to 9:00 at night every 1.5 hours from the 16th of the month until the current monthly check is deposited by the bank?

Answer:

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The government is not forcing lenders to call. While the mortgage servicer’s behavior is obnoxious, this is a case where you can save money by listening to your callers.

The Department of Veterans’ Affairs says that lenders must have a “reasonable” grace period before a late fee becomes due. Typically, mortgage payments are due on the 1st of the month but there is a 15-day grace period in case payments are delayed in the mail. After the grace period, the borrower may then face a late fee.

By paying on the third Wednesday of each month you apparently are making payments far past the grace period. The result is that, unless waived, you are paying needless and costly late fees.

How can this problem be solved?

One option is to speak with the mortgage servicer and ask if the payment schedule can be changed to accommodate your monthly finances. This may not be possible, but it can't hurt to ask. If you get a “yes,” make sure the new payment schedule is confirmed in writing.

The best solution is to change your timetable so that payments are made earlier in the month, a choice that will be tough the first month but easy thereafter. This is the quickest, easiest and surest way to make your unwanted callers and financial penalties go away.

Also, ask your lender if you can make payments online. This may result in a faster credit to your account and the avoidance of monthly penalties.

Peter G. Miller is the author of The Common-Sense Mortgage and a veteran real estate columnist. Have a question? Please write to peter@ctwfeatures.com.

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