what does past due mean 
 past due refers to a payment that has not been made by its cutoff time at the end of its due date a borrower who is past due will usually face some penalties and can be subject to late fees failure to repay a loan on time usually has negative implications for a borrower s credit status and may cause loan terms to be permanently adjusted understanding past duepast due status can occur on any type of payment that has not been paid by the cutoff time on its specified due date payments past due are usually penalized based on the provisions of a contractual agreement credit agreements are one of the most common situations in which past due payments may occur an individual or business who takes out a loan or obtains any type of credit from a lending institution is expected to repay the loan according to the terms of the loan agreement lending products and loan agreements can vary drastically depending on the type of credit product offering some loans like bullet loans require a lump sum payment with interest after a specified period of time the majority of loan products are on a monthly installment schedule which requires the borrower to pay some principal and interest with each payment lending institutions depend on the expected stream of cash flows outlined in loan agreements and will take penalizing steps when payments are not made on time types of loansloans generally fall into either revolving or non revolving categories non revolving credit offers a lump sum payout to the borrower however payment terms can potentially be diverse with borrowers required to pay only monthly interest or interest and principal after a period of time most non revolving credit loans are on a regular repayment schedule known as an amortization schedule which includes payments of both principal and interest monthly revolving credit is typically always on a monthly payment schedule the borrower is required to make a payment every month on an established date revolving credit though does not always have a regular repayment schedule this means payments can vary each month depending on the balance outstanding this is because revolving credit is an open ended agreement in which the borrower has a specified credit limit that they can access if they choose this makes the lending process continuous with the balance depending on how much or how frequently a borrower takes out the credit lines of credit and credit card accounts are considered revolving credit the borrower can dip into the credit balance available in these accounts anytime but is required to make a specified minimum payment every month by a set due date in this case borrowing and repayment are continuous and ongoing penalties and late feesregardless of the type of loan contract a borrower has entered into they must make the required payments by the required due date a borrower who does not make a required payment by the date due will get hit with some type of penalty keep in mind many lenders have time cutoffs on the due date which the borrower must be aware of when making payments for example some lenders may require payment to be received by 8 00 pm eastern standard time while others may allow payment up until midnight in the borrower s time zone if a loan payment is due by the 10th of the month and is not paid within the specified time constraints the payment will be considered past due late fees are one of the most expensive penalties that can occur for a past due bill late fees vary from lenders and types of obligations for mortgages they can range between 3 to 6 of your monthly mortgage payment for credit cards they are usually 25 for the first late fee but can be more for subsequent late payments 12this becomes a good source of revenue for the lender and also a charge that helps to cover some delinquency risks some lenders may not charge late fees at all this can be a good feature to look out for when applying for new credit when late fees are charged they can be substantial and if they accumulate they can be difficult to pay off if a lender charges no late fees a borrower will still be penalized by credit reporting which can affect their credit score payment history usually accounts for the largest portion of a credit scoring methodology at 35 3most borrowers do not report delinquencies until after 60 days past due but if a payment is missed at any time a lender can report it delinquencies stay on a credit report for seven years this is another reason they can be damaging there is nothing a borrower can do to erase delinquencies unlike paying down credit utilization which is the second most important credit scoring factor 345other considerationsdepending on the policy of a lender the borrower will either immediately be charged a late fee and or will be reported delinquent after missing a required payment some lenders may offer grace periods grace periods can be another feature to look out for when applying for credit or reviewing credit terms if for example there is a grace period of 10 days the borrower would not be charged a late fee until 10 days after the due date cutoff if the payment is still not made by the end of the grace period late fees or additional interest may be applied grace periods may also be modified if a borrower exploits the benefit if there is a pattern of late payments the grace period may be shortened or removed 