# Interest on late payment

Interest on late payment is what is applied as a penalty when the debtor fails to comply with payment obligations. The amount of late payment interest must always appear in the contract in which the conditions of the loan or credit with the booth.

We can demand the late payment interest on unpaid bills When the due dates for the payment of the debt that have been required of who has the obligation to pay the invoice are met.

## How to calculate late payment interest

Suppose we pay a monthly fee of 700 euros of mortgageThis month we have had the account at zero and therefore it has not been possible to make the payment, and this situation has lasted for 15 days. Our contract stipulates that in the event of late payment, the current interest rate plus 4 points will be applied, and also a commission for claiming the debt of 25 euros. In this case the default interest would be 7%. The calculation formula is as follows:

Interest on late payment = 700x0,7x15 / 365 = 2,01 euros

To these should be added the 25 euros of the commission for claiming the debt, therefore the total would amount to 27,01 euros.

How to calculate late payment interest on unpaid invoices

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