Late payments: how penalties, late interest and indexation work
Understand what can be charged when an installment is late, see an example with numbers and learn how to check whether the penalty and interest charged are correct.
When a bill or an installment is paid late, the amount due grows. That increase has separate parts, each with its own rule, and knowing how to tell them apart helps you check whether the charge is correct. The rules in this guide are the Brazilian ones.
The three parts of a late payment
- Late-payment penalty (multa moratória): a percentage charged once, simply because the payment was late.
- Late-payment interest (juros de mora): the remuneration for the time late. It grows every day the debt stays open.
- Monetary correction: the update of the amount for inflation, when the contract or the law provides for it.
The penalty: at most 2% in consumer contracts
In consumer contracts, the penalty for lateness cannot exceed 2% of the installment amount. The limit is in the Consumer Protection Code (opens in a new tab), art. 52, §1. A 10% penalty on a consumer installment, for example, is above what the law allows.
Late-payment interest
In ordinary bank contracts, late-payment interest can be agreed at up to 1% a month, according to Precedent Summary (Súmula) 379 of the Superior Court of Justice (STJ). When the contract says nothing about it, the Civil Code applies the legal rate, which since Law 14,905/2024 (opens in a new tab) is the Selic rate minus the IPCA inflation index, with monetary correction applied separately by the IPCA. The limits vary with the type of contract: what counts is what is written in it, within what the law allows.
Late-payment interest is usually simple and proportional to the days late. Dividing 1% a month by 30 days gives about 0.0333% a day.
One point to check: the permanence commission
Some contracts provide a "comissão de permanência" (permanence commission) in place of late charges. In Súmula 472, the Superior Court of Justice holds that it cannot be charged together with remunerative interest, late-payment interest and the contractual penalty. If the statement shows everything added up, it is worth questioning.
An example with numbers
Consider a debt of R$ 5,000.00, a 2% penalty and late-payment interest of 1% a month, calculated per day (0.0333% a day):
| Days late | Penalty (R$) | Late interest (R$) | Total due (R$) |
|---|---|---|---|
| 30 | 100.00 | 50.00 | 5,150.00 |
| 90 | 100.00 | 150.00 | 5,250.00 |
The penalty is charged once. Late interest grows with the days: at 30 days, the R$ 5,000.00 becomes R$ 5,150.00, and at 90 days, R$ 5,250.00.
How to check the charge
- Ask for the detailed statement, with the original amount, the penalty, the late interest, the correction and any other charge, each one separate.
- Compare with the contract: the percentages, the way of calculating and the date when the delay starts counting.
- Check the limits: the consumer penalty of up to 2% and the late-payment interest set in the contract.
- Redo the math with the late payment calculator and see whether the total matches.
- If there is a difference, complain to the creditor first. If that does not solve it, consumidor.gov.br (opens in a new tab) and Procon (the consumer protection agency) take complaints.
What to do when an installment is late
Every day late costs money. In the example above, late interest adds up to about R$ 1.67 a day (0.0333% of R$ 5,000.00), on top of the penalty, which has already been charged. So:
- Pay as soon as you can, asking for a new copy of the payment slip with the charges calculated up to the date you will pay.
- Talk to the creditor before the delay grows. The longer the delay goes on, the heavier the debt gets, and talking early usually keeps more options open. If the debt has already grown large, see how to assess an offer in the guide on debt renegotiation.
- Prioritize the heavier debts: those with higher interest and those with collateral, such as the financing of an asset.
Other consequences of lateness
Besides the amount, being late can lead to your name being added to delinquent-debtor registries. The consumer must be notified in writing beforehand (art. 43, §2, of the Consumer Protection Code), and the negative information cannot stay on record for more than five years (art. 43, §1).
How to use the late payment calculator
In the late payment calculator, enter the original amount, the fixed penalty rate, the daily moratory interest rate and the days late. It shows the penalty, the late interest and the total due. For the daily rate, divide the monthly rate by 30: for 1% a month, enter 0.0333%.
The calculator handles the penalty and late interest. If your charge includes monetary correction, add it separately. And if you have already received an offer to settle the debt, see how to assess it in the guide on debt renegotiation.
This guide is educational and informational. It is not financial, legal or investment advice and it does not know your situation. Example figures are illustrative, and rules change: check the current ones before deciding. Legal Notice