How to figure out late fee on For Sale By Owner

[Steven Payne]

I'm selling a house FSBO and I'm trying to calculate the correct way to charge a late fee. I'll give all the info that I think is needed.

The annual interest rate is 7%. The principal amount is $41,000. The principal and interest due each month on the 11th is $368.52 We escrow the taxes and insurance. The total amount due each month is $754.94.

Under Promise to Pay of the promissory note it states “If any amount is not paid either when due under the Terms of Payment or on acceleration of maturity, Borrower promises to pay any unpaid amounts plus interest from the date the payment was due to the date of payment at the Annual Interest Rate on Matured, Unpaid Amounts”

The Annual Interest Rate on Matured, Unpaid Amounts is 18%.

There is also a clause that says “if any installment becomes overdue for more than ten days, at Lender’s option a late payment of 5% of the amount of the payment may be charged in order to defray the expense of handling the delinquent payment.”