Forgetting the repayment date of the installment can put you in a difficult situation as most of the lenders charge the extra fee for making payments late. Loan providers are not at all interested in knowing the reason of your late payment and they put extra fee right away. Every loan agreement has a clause that explains the consequences of late payment. If you forget one of your repayment dates, then simply check your deal to know things in a better way and try to make payment as soon as possible to avoid further mishaps.

Here are the main clauses that are present in most of loan deals about non payment of installment to due date:

Late Payment Penalty

It is the penalty that is implemented by the lenders if borrower do not make the repayment on the due date. Loan providers put the late payment penalty on the borrowers if then later even by one day. Some of them charge the flat fee whereas other charge fee that is calculated according to the interest and loan amount of the borrower's deal. In flat charges, penalty remains the same till the time of another payment whereas fluctuating penalty is calculated after considering the time period between the due date and payment making day.

That is why, experts always suggest that loan seekers to read all the terms of the deal before making a commitment. Because late payment can be resulted in default or cancellation of the loan.

Skipped Payment Charges

It is the extra fee that is charged when borrower didn't pay the last installment till the next installment due date. It is usually a time period of 30 days between two installments. If you pay your installment within that time period then the lender takes a late payment fee with payment amount. But if you didn't pay last installment and your current installment also get dues, then they put an extra charge and consider your loan as arrears. After that, they start their collection process of the total amount plus accrued interest. They take all the necessary steps to get back their money from you.

Clause Of Grace Period

There are some special loan deals that come with the clause of grace period. If this clause is present in your deal, then you must consider yourself lucky. Because this provision allows the borrower to pay the amount within a certain time period after the actual settlement date. During grace period lender will not charge any late fee and take actual payment only. Usually the grace period is about 15 days which help people to make payment with no charges if they forgot the due date or couldn't make payment because of any other reason.

But do keep in mind that after grace period lender charges a hefty fee from the borrower. Grace period also has different specifications so read your deal carefully.

Conclusion

Forgetting the repayment date will make you pay late payment fee unless you have a grace period clause in your loan deal. So, be very careful while signing the loan terms as these can save your money or ruin your financial life.