Loan Screens > Account Information Screen Group > Account Detail Screen > Late/NSF tab > Late Charge Options field group

Entry: User, checkbox

F/M: Yes

Mnemonic: LNLTCC

Screen: Loans > Account Information > Account Detail > Late/NSF tab

Check this box to indicate to the system that all payments made to delinquent accounts between the due date and grace days period for the current month will keep that account from assessing a late charge for the current month (see Example 1 below). Any payment made, with this box checked, before the due date of the current month may go toward earlier due dates causing the account to assess a late charge for the current month (see Example 2 below). If this box is not checked, payments made may go toward earlier due dates which will cause the account to assess more late charges than allowed by some state laws.

For example, if a loan payment is two months past the due date, and the account owner pays only enough to cover one month's loan payment and makes that payment on the second month's due date or within the grace period, the system usually charges a late fee for the first month the account owner was late, as well as a second late fee for the current month, because the system applies that payment to the first month, leaving the second month still due.

If this box is checked, the system will charge a late fee for that first month but will apply the payment toward the current month. The first month's payment amount is still owed, but the current month's payment will not incur a late fee. However, if the account owner pays even one day prior to the due date, the payment will go toward that first month and not the second month, and the account could incur another late charge if the account owner does not pay a second payment on the due date or within the grace period of the second month.

Example scenarios with the Collect Late Charge When Current box checked:

Example 1: An account owner missed July's payment due July 5. On August 10 (due date of August 5, but with a five-day grace period), the account owner makes a full payment amount for one month. The system would do the following:

•Charge a late fee for July's payment

•Not charge a late fee for August's payment, because the account owner made a timely payment in that month

Example 2: An account owner missed July's payment due July 5. In August, the account owner makes a full payment for one month and pays it on August 4, one day before the due date. The account owner makes no additional payments in August. The system would do the following:

•Charge a late fee for July's payment

•Charge a late fee for August's payment

If an account is assessed a late charge, the account will appear on both the Late Charge Journal (FPSRP065) and Loan Afterhours Processing Exception Listing (FPSRP013).