Who's Good Enough To Find...
Who's good enough to find out the maximum a lender can charge you in late fees for a first mortgage? It's gotta be a Federal Law that states the amount SOMEWHERE- otherwise they could charge REDICULOUS amounts- such as $50/hr per late...
Most likely, it's a set amount or percentage of the payment for each month. Can you guys help me find the statute that states the exact amount? I'm sure it's a Federal Law, but, just in case, I'm in Arizona.
THANKS!
Please respond to my email- rat_racer@cox.net">rat_racer@cox.net
Rat Racer
Suggest that you check your own state's usuary laws on this subject. Your state has a maximum interest rate that can be charged without violating the usuary law. Late fees on your mortgage may be regulated by your state's usuary law.
When you are in default (otherwise there would not be a late fee), the lender can charge you 100% of the loan balance by calling your note. [ Edited by DaveT on Date 02/04/2003 ]
This is a direct link to the website to look up Arizona statutes and the state constitution:
http://www.azleg.state.az.us/ArizonaRevisedStatutes.asp
Good luck.
hehe- thanks for the general advice- already been there, done that- which is why I posted. I dont think AZ has any usery laws that state it specifically... anyone else know FOR SURE???
Thanks!
D
Hello Rat_Racer:
I can't say for sure but I live in Minnesota. For my mortgage on my personal residence it is 5% of whatever the payment is. (although i've never been late so never had to worry about)
Brandon "Optimum" E.
Quote: I dont think AZ has any usery laws that state it specifically rat_racer,
I looked at Title 44 - Trade and Commerce and found this 5% rule.
44-6002. Retail installment contracts; retail charge account agreements; definitions
G. Notwithstanding the late payment or delinquency charge provided in subsection B or F, in a commercial transaction, the seller or holder may charge a late payment or delinquency charge, in addition to all finance charges permitted, on each installment not paid in full upon the tenth day after its due date in an amount of not more than five per cent of the unpaid balance of the installment. [ Edited by DaveT on Date 02/16/2003 ]
yes- I have come across that myself- but does this apply to real estate? It's under a completely different section from Real Estate- which is why I ruled it out. What do you guys think?
RR
You will have to ask your lawyer whether this rule for installment contracts, by implication, would also apply to real estate loan agreements. I say by implication because the IRS treats a seller financed sale of real estate as an "installment contract".[ Edited by DaveT on Date 02/16/2003 ]