Days Past Due
Definition
Days past due, or DPD, measures how late a payment is compared with the contractual due date or other agreed aging convention. It is a basic input for delinquency reporting, eligibility tests, default definitions, charge-off policies, and servicing triggers.
Why it matters
DPD turns payment friction into measurable credit data. In private credit, the same borrower can be described as performing, delinquent, in grace period, in default, or in workout depending on the DPD threshold and contract definitions. Investors need the exact convention before comparing platforms or pools.
Common misconceptions
- •DPD is not always measured from the same starting point across asset classes.
- •A grace period can delay default status without eliminating payment stress.
- •A restructured account may reset DPD even though historical stress remains relevant.
Technical details
Measurement conventions
Loans usually age from a scheduled payment due date. Invoices may age from invoice date or due date. Merchant cash advances may use remittance interruptions rather than a fixed monthly due date.
A 30 DPD threshold can mean very different things for a weekly remittance product, a monthly amortizing loan, and a net-90 trade receivable.
Structural consequences
DPD thresholds can make collateral ineligible, trigger cash sweeps, increase reserves, require servicer action, or move a deal into default reporting.
Later-stage DPD buckets usually have lower cure rates and higher loss severity, but the relationship depends on collateral type and servicing intensity.
What to ask
Is DPD calculated before or after grace periods?
Are partial payments enough to keep an account current?
Are modified or extended assets reported using original terms, amended terms, or both?