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When Should You Pay Your First Mortgage After Closing Your Home?

Brady Webb
September 23, 2024

After you’ve signed all of those papers at the closing table and have the keys in your hand, it’s finally real — you’re a homeowner! This means you have a brand-new responsibility, a mortgage payment. This begs the question: when do you pay your mortgage dues after closing?

How Closing Dates Affect Your First Mortgage Payment

The first mortgage payment is due after owning your new home for 30 days. It’s recommended to prepare your mortgage payment the day you close, so the payment is deducted automatically from your bank account or credit card the day the first payment is due. You don’t want to be late on your mortgage payment, even if it’s the first one.

When is the Best Time to Close on a Mortgage?

Many people ask, “When is the best time to close on a mortgage?”

Beginning of the Month – Longer Time Before First Mortgage Payment is Due but Comes with Higher Interest Charges. Closing on your mortgage at the beginning of the month will give you the longest time before your first mortgage payment is due — approximately 30 days. So if you close on the first of February, your first mortgage payment will be on the first of April. If you have a longer time before the first mortgage payment is due, you won’t need to worry about budgeting for the payment when you close on the home. You’ll have more time to budget for the payment and can plan for it accordingly. However, at the beginning of the month, the interest rate increases. The longer your mortgage is open, the higher the interest rate you’ll pay.
Middle of the Month – Best of Both Worlds with Slightly Longer Payment Time and Interest Charges. Closing on your mortgage during the middle of the month will give you a slight edge over closing at the beginning of the month. For one, you get to have 45 days before paying your first mortgage, so you’ll have slightly more time to prepare for the payment. Most people have their paychecks directly deposited on the first of the month. In that regard, you’ll have the added time to plan the mortgage payment’s impact on your budget. But you’ll also have a slightly higher interest rate than if you closed at the beginning of the month as you will have an additional 14 days topped onto your prepaid interest.
End of the Month – Shorter Payment Dues, but Lower Interest Charges. Closing on your mortgage at the end of the month will give you the shortest time before you start paying your first mortgage dues, approximately about 30 days compared to the other alternatives. The good news is that closing at the end of the month will give you a lower interest rate. You’ll have fewer days to prepay interest and you’ll have less interest rates to pay.

The Bottom Line: What to Know About Your First Mortgage Payment After Closing Costs.

The time you close your home can impact when your first mortgage payment is due and its associated interest rates, so be sure to consider the different factors and choose the date that is ideal for your unique situation.

Contact Mortgage Specialist Today!

If you are looking for the best Louisville mortgage brokers, then you have come to the right place. American Mortgage Solutions KY offers a wide range of services that can help you with all of your real estate needs, so get in touch with us today at (502) 327-9770 and see how we can finance the home of your dreams.

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