source:
  type: guide
  id: hud-4000-1-iii-c-late-charges
  authority: FHA Single Family Housing Policy Handbook 4000.1, Part III — c. Late
    Charges (10/01/2025)
  description: FHA Single Family Housing Policy Handbook 4000.1, Part III — c. Late
    Charges (10/01/2025).
  coverage_tier: operative
obligations:
- id: hud-4000-1-iii-c-late-charges-full
  canonical_id: hud-4000-1-iii-c-late-charges-full
  section: FHA Single Family Housing Policy Handbook 4000.1, Part III — c. Late Charges
    (10/01/2025)
  type: do
  tags:
  - regulator-direct
  - fha
  - hud-handbook
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: FHA Single Family Housing Policy Handbook 4000.1, Part III — c. Late
      Charges (10/01/2025)
    source_class: hud-handbook
    source_url: https://www.hud.gov/hud-partners/single-family-handbook-4000-1
    snapshot_id: 8c03836f77f317e1
    fetched_at: '2026-05-23T00:28:40Z'
    content_hash: sha256:411430f29b13f9b54a2ebb0e6f6e7087ecd2b90d0da22eb0c8c792eaa2d7d0df
    paragraph_quote: 'c. Late Charges (10/01/2025) i. Definition Late Charges are
      charges assessed if a Mortgage Payment is received more than 15 Days after the
      due date. ii. Standard The Mortgagee may consider a Borrower’s Mortgage Payment
      late if the payment is received by the Mortgagee more than 15 Days after the
      due date, except for payments received from Borrowers in accordance with a Trial
      Payment Plan Agreement. The Mortgagee may assess a late charge on the 17th Day
      of the month. For Mortgages assigned a case number on or after March 14, 2016,
      the Mortgagee may assess a Late Charge, not to exceed 4 percent of the overdue
      payment of P&I and in accordance with applicable state and federal laws. For
      Mortgages assigned a case number before March 14, 2016, the Mortgagee may assess
      a Late Charge calculated based on overdue PITI if permitted under the terms
      of the mortgage Note and under applicable state and federal laws. (A) Notifying
      the Borrower of the Late Charge Before collecting the Late Charge or returning
      a Mortgage Payment to the Borrower for failing to pay the Late Charge, the Mortgagee
      must provide the Borrower with an advance written notice of the charge. III.
      SERVICING AND LOSS MITIGATION A. Title II Insured Housing Programs Forward Mortgages
      2. Default Servicing Handbook 4000.1 1187 Last Revised: 11/26/2025 The Mortgagee
      must include in the advance notice the following information: • the due date
      of the monthly Mortgage Payment; • the amount of the regular monthly Mortgage
      Payment; • the date on which the Late Charge will be imposed; and • the amount
      of the Late Charge (or the full amount now due which consists of the regular
      monthly Mortgage Payment plus the Late Charge amount). (B) Application of Subsequent
      Payment to Unpaid Late Charges After advance notice has been sent to the Borrower,
      the Mortgagee may: • treat any subsequent payment that does not include the
      Late Charge in accordance with HUD’s Partial Payments for Mortgages in Default
      section; and • deduct amounts due for Late Charges owed for a previous installment.
      (C) Default/Foreclosure Due to Unpaid Late Charges A Mortgage may be technically
      in Default by its terms if a Late Charge is not paid within 30 Days after it
      becomes due. However, the Mortgagee may not initiate foreclosure action when
      the only delinquency is due to: • unpaid Late Charges that are due on the account;
      and/or • unpaid monthly payments that remain unpaid because the Mortgagee did
      not comply with HUD’s Partial Payments for Mortgages in Default section. iii.
      Required Documentation The Mortgagee must ensure that the Servicing File reflects
      any Late Charges assessed and includes any advance written notice of such charges
      sent to the Borrower.'
  judgment: false
