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#239008 - 08/31/04 05:58 PM Late charges...
Anonymous
Unregistered

can anyone direct me to the maximum amount a bank can charge loan customers as a late charge for paying late...
thank you

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#239009 - 08/31/04 06:39 PM Re: Late charges...
PatrickG Offline
100 Club
PatrickG
Joined: Jun 2001
Posts: 165
Binghamton, NY, USA
Real Property Law Article 8 Section 254-b limits late fees on mortgages to 2% of the deliquent installment. It has to be charged seperately.

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#239010 - 08/31/04 07:08 PM Re: Late charges...
Anonymous
Unregistered

Patrick,
Is there anything about other installment loans, not real estate secured?

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#239011 - 09/02/04 02:57 PM Re: Late charges...
PatrickG Offline
100 Club
PatrickG
Joined: Jun 2001
Posts: 165
Binghamton, NY, USA
Section 108 (4)(c) of Article III of the Banking Law sets the limit at 5 cents per dollar (five dollars maximum) on any one installment and no more than 2% ($25 maximum) in aggregate.

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#239012 - 09/02/04 03:50 PM Re: Late charges...
Anonymous
Unregistered

Patrick,
what if the loan falls under Retail Installment?

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#239013 - 09/02/04 07:06 PM Re: Late charges...
PatrickG Offline
100 Club
PatrickG
Joined: Jun 2001
Posts: 165
Binghamton, NY, USA
I am only familiar with the Banking Laws. Sorry I can't help you.

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#239014 - 09/07/04 02:32 PM Re: Late charges...
JJohns Offline
Platinum Poster
JJohns
Joined: Jun 2003
Posts: 682
IL
Personal Property Law Ch 41, Art 10, Sec 402.6 covers retail installment contract delinquency charges.

If it's a motor vehicle retail installment contract, its 41-9-302.7.

Both appear to have the same provision- 10 day grace period, and can charge "an amount not in excess of the rate or rates agreed to in the contract". Safe bet is to charge a resaonable charge that is in line with what is customarily charged in the industry & have it blessed by your legal area.
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