How Are Late Fees Calculated

1. Senior Member
Join Date
Jun 2008
Posts
250

How Are Late Fees Calculated

My question involves a consumer law issue in the State of: TN

Bought a car from buy her pay here and got behind like 2 payments which is lets say \$150 every 2 weeks so im behind \$300, and then I make my regular payment of \$150 every 2 weeks while still being behind the \$300

Now on my contract it says
LATE PAYMENT: You must pay a late charge if any payment is not made in full within 4 days after the payment is due. The charge is 15% of the part of the payment that is late or 575 which ever one is lesser.

Now I know when I make my payment im paying for my behind payment not my current payment due.

I'm confused as to how the late fees should be calculated. They should calculate base on the late payment and not the TOTAL past due right?

So basically i should be getting charged %15 of \$150 every 2 weeks until i pay off my past due of 2 payments. And yes i know late fees would be adding up..

Somehow the lot figures I owe around \$600 past due with late fees. Im 2 payments past due on car note which is \$150 a piece and i first got behind around the end of march..then around middle of April i started making my regular payments.

If my math servers me right I shouldn't we that much. How can i get \$300 in late fees from the time of end of march?

2. Senior Member
Join Date
May 2008
Posts
111

Re: Late Fee Caculation. Check My Math

unless of course its 15% per DAY..then it would add up.

3. Senior Member
Join Date
Jun 2008
Posts
250

Re: Late Fee Caculation. Check My Math

Quoting shelbydakota
unless of course its 15% per DAY..then it would add up.
no its not it.

So I guess Im asking if they can charge late fee on top of late fee?
And by what this is stated on my contract:LATE PAYMENT: You must pay a late charge if any payment is not made in full within 4 days after the payment is due. The charge is 15% of the part of the payment that is late or \$75 which ever one is lesser.
because they are saying its a recurring late fee charge

4. Senior Member
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Sep 2005
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98,846

Re: How Are Late Fees Calculated

I am not sure how you distinguish the "past payment" you owe from "the total past due" - or are you stating that the "total past due" includes the past due late fees as well as past due car payments? If it's the latter, check your contract to see how the late fees are characterized.

You can try asking how they're calculating the late fee. They may be applying the \$75 without paying attention to the fact that they should be applying the lesser percentage. If you're supposed to pay every two weeks and they're charging you \$75 each time, four months = roughly eight weeks; 8 x \$75 = \$600.

5. Senior Member
Join Date
Jun 2008
Posts
250

Re: How Are Late Fees Calculated

I m 2 car notes behind since end of march which equals \$300. Now since march to now the late fees have came to close to \$300. So Now total owed is \$600..

Im trying to figured out how they calculated \$300 in late fees since then when in contract it says 15% per late payment.

They keep giving me all kind of explanations. Now they say the 155 is applied to the total past due with late fees. but it doesn't say that on contract

6. Junior Member
Join Date
Jul 2011
Posts
3

Re: How Are Late Fees Calculated

I'll admit that I am new at this response concept. But, if I may weigh in... I have not paid a late fee for anything in over 3 years, and I have been late more than a few times. The key is persistence. First, try and explain that you inadvertently missed a payment and thought that you had rectified things, misunderstanding how the company calculated their fees. If that doesn't work, escalate: try to find a logical reason that they should not charge you (most companies actually can waive one or two late fees a year). If that doesn't work, escalate further. Keep pushing, wear them down, until you get the person with the highest title. Don't take no. Google every number for the company that you can if necessary. Demand that they show you the math, and rescind the late fees. As I understand it, late fees cannot be used to denigrate your credit, as long as your actual payments are within 30 days of your payment date. Get a government entity involved who handles such types of debts. The actual threat many force the company to reconsider. If not, go through with it, file whatever you need to, keep paying your monthly payments, and keep contacting the company - every chance you get. (I sometimes tell them that I have no intention of paying the fees anyway, so they might as well work things out with me now.) Be persistent and don't give up. Sometimes they will work with you just to get you to leave them alone.

I pray this helps.

1.