Per Diem Interest - Glossary Real Estate Tags

Per Diem Interest

Interest from the day of closing to the first day of the following month. To simplify the task of loan administration, the accounting for all home loans begins as if the loan was closed on the first day of the month following the day the loan is closed. For example, if the loan is closed and the money disbursed on May 15, the clock begins ticking on that loan as if it were closed on June 1, with the first payment due July 1. But since the lender actually gave you the money on May 15, the lender expects to be paid interest for the period between May 15 and June 1. That payment is the 'per diem interest,' which is due at closing. If the loan in the example above was $100,000 and the interest rate 6%, the per diem interest would be $100,000 x .06/365 x 17, or $279. In some cases, especially when a loan is closed early in the month, the lender is willing to rebate interest to the borrower for those few days and collect the first payment a month earlier. If the loan above was closed May 3, for example, the lender would pay three days of interest at closing and collect the first monthly payment on June 1.



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  • Ed Goldfarb

    United Realty Group

    Ed Goldfarb

    Mobile: 954-605-8427   

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    "1800 sales - 25 years experience plus strong negotiation skills gets you the very best deal everytime. At 20 years old, I proudly served my country as a navy fighter pilot and Naval Officer. I now serve my clients with the same dedicated commitment, honor, integrity, ethics and account" ... view more

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    Keller Wiiliams Realty Partners SW

    Roseline Serrano

    Mobile: 954-702-6347    Office: 954-237-0400   

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    " Love what you do, and never work a day in your life... Roseline began her career in the Banking and Mortgage industry while in college, where she graduated with an accounting degree. She discovered her passion for Real Estate while working in the M" ... view more

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  • Liza Tamayo

    Keller Williams Real Estate

    Liza Tamayo

    Mobile: 954-588-5500   

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    "Buy or sell real estate property. The purchase or sale of a home or investment property is one of the most complex and significant financial events in peoples' lives. People typically seek the help of real estate brokers and sales agents when buying or selling re" ... view more

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