If You Pay During the Grace Period, Beware of the Simple Interest Mortgage

August 24, 2008 by  
Filed under Loans and Borrowing

This hard truth warning is for homeowners everywhere who carefully schedule their mortgage payments to arrive at the bank or mortgage processor not on the due date but on the last day of the “grace period.”  By grace period, I am referring to the date by which, if your payment is not received, a late penalty is imposed.  (I’m not sure why so many home owners like to push the envelope on this month after month.  If you think it through, you are really only saving yourself one “grace period” worth of interest on one payment.) Read more