grace period

Grace period

The time period stipulated in most loan contracts and insurance policies during which a late payment will not result in default or cancellation.

Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Grace Period

1. The time after the due date for a loan payment during which one may make the payment without any late fees or penalties. The length of the grace period depends on the loan terms, but is usually around 15 days.

2. The time after rent is due, during which one may pay rent without a late fee. The grace period for rent is usually five days.

3. In bonds, the time between the issue of the bond and the first coupon payment. This grace period usually applies to long-term bonds, where interest payments do not begin to occur for a few years after issue.

Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

grace period

The period during which the issuer of a bond is not required to make interest payments. For example, a bond issued this year might only start paying interest five years from now. Bonds with grace periods are sometimes issued during a corporate restructuring.

Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

Grace period.

A grace period is the number of days between the date a credit card issuer calculates your new balance and the date your payment is due.

In most cases, if you have paid the previous balance in full and on time, and you haven't taken any cash withdrawals, no finance charges are added to the amount of your purchases.

If you generally pay the entire balance due on time, you may want to choose a card with a longer rather than a shorter grace period, assuming the other terms are comparable. That gives you more time to be sure your payments arrive on time.

However, a minority of credit arrangements include a minimum finance charge, even if you do pay on time. Other lenders go back two billing cycles and will add finance charges if you have not paid the full amount due each time.

The grace period on a student loan allows you to defer repayment so that the first installment isn't due until six or nine months after you graduate or are no longer enrolled at least half time. The timing depends on the type of loan.

You also have a grace period in which to pay the premium on an insurance policy before the policy is cancelled. It's usually one month after the due date.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.

grace period

The allotted time during which a payment can be made without penalty and without entry upon credit records as delinquent or in default.

The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.

Grace Period

A number of days, usually 10 to 15, that a borrower is allowed to be late in making the mortgage payment without suffering any penalty.

The Mortgage Encyclopedia. Copyright © 2004 by Jack Guttentag. Used with permission of The McGraw-Hill Companies, Inc.