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Under contract. Do I pay mortgage?

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New Contributor

Under contract. Do I pay mortgage?

It's Sunday so I can always email my LO tomorrow.

 

My house is under contract. We close on the 15th of August for our current home and the 16th of August on our new home. Do I have to make my August 1st mortgage payment? What if I make the payment on August 9th (within the grace period)

 

Let me know what you think.  I CAN pay it August 1st. It would just be awesome if I didn't have to Smiley Happy 

5 REPLIES 5
Frequent Contributor

Re: Under contract. Do I pay mortgage?

Nope. Even if your current lender were to receive the funds on the 16th you'd still be okay. They charge the late fee after the 15th but no lender can mark you late if you pay before September 1st.
Message 2 of 6
Frequent Contributor

Re: Under contract. Do I pay mortgage?

You do not have to pay it. As ling as the lender receives.a payment or the full balance before September 1st, they cannot mark you late. They will change you a late fee after the 15th as they all do to make extra profit but there will be zero negative impact to your credit.
Message 3 of 6
New Contributor

Re: Under contract. Do I pay mortgage?

Awesome! Thanks for your help.

Message 4 of 6
Valued Contributor

Re: Under contract. Do I pay mortgage?

Be prepared to be hit with a late fee in the event the payoff reaches them after the 15th and it likely will.... if you are ok with that then as long as they receive prior to the 1st you are ok.
Message 5 of 6
Community Leader
Super Contributor

Re: Under contract. Do I pay mortgage?

I always think of Murphy’s Law—if something can go wrong, it will.

 

I say pay it on the first. Mortgages are paid in arrears so really, the Aug 1 payment is for July’s mortgage. (I think that’s the way it works). So pay on Aug 1 and if there’s a refund due to you, you’ll get it back at settlement. Paying on Aug 1 eliminates the worry—no ifs or buts. 

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