When Is the First Mortgage Payment Due After Closing?
Understand your first mortgage payment due date after closing. Get clear guidance on finding key information and making your initial payment.
Understanding when your first mortgage payment is due after closing is important for new homeowners. This date is crucial for financial planning and helps ensure a smooth transition into homeownership.
Calculating Your First Payment Due Date
Your first mortgage payment is due on the first day of the second full month following your closing date. This often falls between 30 to 60 days after closing. For example, if you close on August 15th, your first payment would be due on October 1st. Mortgage payments are made in arrears, meaning each payment covers the interest from the prior month.
Odd days interest, also known as prepaid interest, accrues from your closing date through the end of that month. This interest is typically collected at closing. For example, if you close on August 15th, you would pay interest for August 15th through August 31st at closing. Your October 1st payment would then cover September’s interest.
The specific day within the month that you close influences the gap before your first payment. Closing earlier in the month means more odd days interest paid at closing, but a longer gap before your first monthly payment. Conversely, closing late in the month reduces odd days interest but brings the first payment due date closer. The first payment is never due in the same calendar month as the closing.
Locating Your Payment Information
After your mortgage closes, your official loan documents detail the precise information for your first payment, including the exact due date and amount. The Closing Disclosure (CD) is a primary document to examine. This form provides a comprehensive overview of your final loan terms, including the loan amount, interest rate, projected monthly payments, and closing costs. The CD explicitly lists your first payment due date and initial payment amount.
Another essential document is the Promissory Note. This note is your legal promise to repay the loan and specifies its terms, including the principal amount, interest rate, and the precise date your first payment is due. Both the Closing Disclosure and the Promissory Note are provided to you at or before your closing appointment.
Your loan servicer typically sends a welcome packet after closing. This packet often contains detailed instructions for setting up your account, making payments, and reiterates the first payment due date and amount. If you cannot locate this information or do not receive a welcome packet, contact your lender or loan servicer directly to confirm payment details.
Submitting Your First Mortgage Payment
Several common methods are available for submitting your first mortgage payment. Most loan servicers offer an online portal accessible through their official website. This allows homeowners to make one-time payments or set up recurring automatic deductions. Setting up an online account often requires your loan number, which is provided in your welcome packet or closing documents.
Paying by mail is a traditional method, with your servicer providing a specific mailing address for payments, often accompanied by a payment coupon. Confirm the correct mailing address to ensure timely delivery and processing. Many servicers also accept payments over the phone. While convenient, some servicers may charge a small processing fee for phone payments.
Regardless of the chosen payment method, it is advisable to submit your payment a few business days before the actual due date. This practice allows for processing time and helps avoid potential late charges.