Grace Period

A grace period refers to a period of time after a payment deadline where a penalty or additional amount is not imposed.

What is a grace period? 

A grace period refers to a period of time after a payment deadline where a penalty or additional amount is not imposed. They are sometimes included in contracts, loan agreements, or rental agreements to provide some flexibility to the payer. 

How long is the grace period?

A grace period can pertain to many payments on things including credit cards, mortgages and other bills. Grace periods vary from lender to lender with some credit card lenders giving 21-55 days and mortgage lenders 7-15 days. 

Is a grace period the same as a cooling off period? 

A grace period is not the same as a cooling off period. A grace period refers to a period of time after a payment deadline during which late fees or penalties are waived. 

On the other hand, a cooling off period is a specific period of time after a contract is signed during which a buyer can cancel the contract without penalty. It's often provided in contracts for real estate purchases or certain types of consumer agreements to allow buyers time to reconsider their decision and withdraw from the contract if they change their mind.

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