In real estate finance, a Late Charge is a fee imposed by a lender when a borrower fails to make a scheduled loan payment by its due date. The charge is intended to compensate the lender for the additional administrative costs and inconvenience caused by the late payment.
Late charges are typically outlined in the loan agreement and may be assessed after any applicable grace period has expired. Repeated late payments can negatively affect a borrower’s credit and may lead to default under the loan terms.
