Personal loan with ex girlfriend

[Djlose]

What is the name of your state (only U.S. law)? Florida

I have a personal loan with an ex. I owe her $1161.80 for the loan with a $10 late charge. The monthly payment is $140. I've calculated it out to be a total of $420 without the late charge to bring it current. I have explained too her that I can make a $220 payment and then a $200 payment in order to pay the $420, in which both payments are more than the monthly payment. She is trying to state that a partial payment is not "vested", however, the past due amount and current payment doesn't constitute a single payment. The total of $420 is 3 payments combined. Can she legally refuse these payment I am willing to make to bring the loan current?

Also, her explanation of the late fees is that, verbatim, "Your late fees accrue per months you are late. The further you get behind, the higher the fee." I asked for clarification on this because if she means that the late fee is compounding and each month late expands by the base $10 amount power month late, on top of the previous month late fee, if I we're to default for 12 months, it would be a total of $780 in the year for late fees alone. I know that under Chapter 687 of Florida Statute, that a loan which charges more than 18% interest per annum is declared usurious. Am I right that late charges are considered interest, and if so with the balance of outstanding debt of $1161.80 would equal an annum interest of 18.39%?

Please help. Thank you.

 

[adjusterjack]

What is the name of your state (only U.S. law)? Florida

I have a personal loan with an ex. I owe her $1161.80 for the loan with a $10 late charge. The monthly payment is $140. I've calculated it out to be a total of $420 without the late charge to bring it current. I have explained too her that I can make a $220 payment and then a $200 payment in order to pay the $420, in which both payments are more than the monthly payment. She is trying to state that a partial payment is not "vested", however, the past due amount and current payment doesn't constitute a single payment. The total of $420 is 3 payments combined. Can she legally refuse these payment I am willing to make to bring the loan current?

If you are in arrears for $420 plus late charges and you don't pay the entire amount along with the late charges you are NOT bringing the loan current. You are still in default and she is within her rights to refuse partial payment.

Also, her explanation of the late fees is that, verbatim, "Your late fees accrue per months you are late. The further you get behind, the higher the fee." I asked for clarification on this because if she means that the late fee is compounding and each month late expands by the base $10 amount power month late, on top of the previous month late fee, if I we're to default for 12 months, it would be a total of $780 in the year for late fees alone. I know that under Chapter 687 of Florida Statute, that a loan which charges more than 18% interest per annum is declared usurious. Am I right that late charges are considered interest, and if so with the balance of outstanding debt of $1161.80 would equal an annum interest of 18.39%?

A late fee is not interest so the usury statute doesn't apply. Even 687.03 allows for interest AND late fees but the limit on late fees doesn't appear to apply to a personal loan like you have.

I was a landlord for twenty years so I can tell you how late fees work.

Your monthly payment is $140. Let's say for this example it was due Apr 1. If you didn't pay it a late charge of $10 was added. That made $150 due for the Apr payment because it was past due. May 1 comes along and you have $140 due for May + $150 for Apr. If you paid $290 on Apr 1, you'd be square. But if you didn't pay $290 on Apr 1 another $10 late charge would apply to the Apr payment. You would then owe $300. Jun 1 comes around and you owe $300 plus $140 = $440. You don't pay it. Another $10 gets added for the Mar payment. $300 + $150 = $450.

Today you owe $450, not $420.

If she accepts your $200 today you would have to pay $250 by the end of June to be up to date and then you would have a payment of $140 due on July 1.

I don't know where you came up with $780 in late fees for a year. 12 x $10 is only $120.

Your GF may not be explaining it clearly but I just did.

There is nothing illegal about a $10 late fee on a payment of $140. Look at your credit card statement. A late fee is $20 to $40 depending on the amount of the payment that's due and that's in addition to interest. And if you don't pay your minimum payment on time every month the late fee will be applied every month to the balance.

 

[Djlose]

Where I came up with the $780 was how she explained it was, the first month late is $10. Second month is $20 plus the previous $10, equaling $30, and so compounding. If the payment became 12 months late, the charge for that one month would be $120 on top of the previous month's $110, $100 the month before and so on. So, after 12 months of such a format on late charges, the end result of a year worth of late charges is $780...

 

[Djlose]

And looking through 687.03 again, it states in regards to late fees:
arge a delinquency charge on each installment which is in default for a period of not less than 10 days in an amount not in excess of 5 percent of such installment. However, only one such delinquency charge may be collected on any installment, regardless of the period during which it remains in default. A delinquency charge imposed pursuant to this paragraph.

That means she can only charge me one time for being late per installment. And the way she started it was that in effect she would be charging me each month that installment was late. Am I right on that?

 

[Djlose]

Plus, with the instalment of $140 per month, the max late fee she can charge is 5%, equaling $7. Am i correct?

 

[Djlose]

Please don't misunderstand my questions as me trying to get out of paying, I'm willing to pay the $450 for April, May, and June before it comes due again on July 13, including the $10 late fees for April-June since I can't afford the $450 by this coming Tuesday. I lost my job for 1.5 months while we were together, and now that we've separated a week ago, i worry she's trying to take advantage.

 

[HRZ]

I am agreeing wIth adjusterjack that n general your late fees stack up and also as a retired LL my leases were quite clear on that point with correct legal drafting for my state .....your state might differ ...

Her language about vesting makes no sense to me ...ME, I'd be glad to take a partial payment ...it does not stop the late fees from stacking up and my guess is you disagree about late fees running until everything due is paid in full ?

 

[Djlose]

I don't disagree on late fees until amount is paid current. I disagree on her attempt to state that any amount paid either in partial or over the monthly amount will not be placed towards the amount owed, but towards rent, utilities, and other household expenses. THAT'S where I'm having the issue, in essence, her attempt to extort more money out of me by starting that because the amount doesn't qualify as payment towards the loan. Nor am i disagreeing with how late charges are assessed you the account, but how she is attempting to charge them to the account. As outlined above, the way she is attempting to charge for delinquency is compounding. So if the payment was late for 4 consecutive months, the fees would be $10+$20+30+40=$100 on late fees after the fourth month instead of $10+$10+$10+$10=$40 in late fees.
Also, this isn't a rental agreement. As per statute 687.03, she can't charge the fee before the 10th day and no more than 5% of the monthly instalment.
These are all of the issues that I'm having with this so called contract she's attempting to enforce. I feel as though this is extortion at this point.

 

[Zigner]

Do you ALSO owe money to her for rent, utilities, etc?

 

[adjusterjack]

Where I came up with the $780 was how she explained it was, the first month late is $10. Second month is $20 plus the previous $10, equaling $30, and so compounding. If the payment became 12 months late, the charge for that one month would be $120 on top of the previous month's $110, $100 the month before and so on. So, after 12 months of such a format on late charges, the end result of a year worth of late charges is $780...

Never mind how she explains it. What, exactly, does your contract say about the late fee? Quote it word for word.

And looking through 687.03 again, it states in regards to late fees:
charge a delinquency charge on each installment which is in default for a period of not less than 10 days in an amount not in excess of 5 percent of such installment. However, only one such delinquency charge may be collected on any installment, regardless of the period during which it remains in default. A delinquency charge imposed pursuant to this paragraph.

That means she can only charge me one time for being late per installment. And the way she started it was that in effect she would be charging me each month that installment was late. Am I right on that?

Plus, with the instalment of $140 per month, the max late fee she can charge is 5%, equaling $7. Am i correct?

You appear to have overlooked that part of 687.03(c) that precedes the word "charge."

Notwithstanding any other provision of this section, any lessor or merchant, or any person who lends money or extends any other form of credit, who is regularly engaged in the business of selling or leasing merchandise, goods, or services which are for other than personal, family, or household purposes, or any assignee of such lessor, merchant, or person who lends money or extends any other form of credit, who is the holder of a commercial installment contract, each of which persons or entities is subject to the laws of any jurisdiction of the United States, any state, the District of Columbia, the Commonwealth of Puerto Rico, or any territory or insular possession of the United States, may, if the contract so provides,

That's hard to read but I think it doesn't cover your personal loan so the late fee is not limited to 5%.

Please don't misunderstand my questions as me trying to get out of paying, I'm willing to pay the $450 for April, May, and June before it comes due again on July 13, including the $10 late fees for April-June since I can't afford the $450 by this coming Tuesday. I lost my job for 1.5 months while we were together, and now that we've separated a week ago, i worry she's trying to take advantage.

Typical results of getting financially involved with a romantic partner. Lesson learned.

I don't disagree on late fees until amount is paid current. I disagree on her attempt to state that any amount paid either in partial or over the monthly amount will not be placed towards the amount owed, but towards rent, utilities, and other household expenses. THAT'S where I'm having the issue, in essence, her attempt to extort more money out of me by starting that because the amount doesn't qualify as payment towards the loan.

You haven't mentioned any of that before. It's not extortion if you actually owe the money. As I wrote earlier she can refuse the partial payment on the loan and if you write her a check for less than the $450 anyway she can apply it to anything else you owe.

Nor am i disagreeing with how late charges are assessed you the account, but how she is attempting to charge them to the account. As outlined above, the way she is attempting to charge for delinquency is compounding. So if the payment was late for 4 consecutive months, the fees would be $10+$20+30+40=$100 on late fees after the fourth month instead of $10+$10+$10+$10=$40 in late fees.
Also, this isn't a rental agreement. As per statute 687.03, she can't charge the fee before the 10th day and no more than 5% of the monthly instalment.
These are all of the issues that I'm having with this so called contract she's attempting to enforce. I feel as though this is extortion at this point.

Doesn't really matter what either of you say since you aren't agreeing to anything.

You can always refuse to pay anything and let her take you to court.

 

[quincy]

Never mind how she explains it. What, exactly, does your contract say about the late fee? Quote it word for word. ...

You do not have to quote the contract. For one thing, contracts need to be read in their entirety and not in bits and pieces, and for another thing, analyzing the words and terms and clauses of contracts goes beyond the scope of this forum. It is the practice of law. For an analysis of a specific contract, you need an attorney licensed to practice in your own jurisdiction.