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What Happens When I Miss Mortgage Payments?
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What Happens when you Miss Your Mortgage Payments?If you miss one or two motgage payments, you will be required to repay the amount you are behind as soon as possible. Penalties, late charges, and legal fees may be added to your mortgage balance, and these can be very substantial.
If you miss 3 mortgage payments, you are on the road to foreclosure. Foreclosure is the legal right of your lender to repossess or assume ownership of your home. When foreclosure happens, you will have to move out of your house, giving up all title to it. If you owe more than the value of your property, your lender might pursue a deficiency judgment against you, which means that not only do you lose ownership of your home, you also may wind up owing your lender or servicer additional money after youve been removed from the property.
Missing a mortgage payment can be very detrimental to your credit score. Because your credit and credit scores can be used and looked at when you apply for jobs (with some companies), to assist with calculating homeowner's insurance premiums, auto insurance premiums, to apply for loans, to apply for credit cards, to refinance your home, and so many more things, your whole life can be affected by missing mortgage payments. Therefore, it is important to do what you need to in order to make sure that you are making your mortgage payments on time, or at least before they become 30 days past due. If you are aware that you are going to be late on a mortgage payment and you have no other options to come up with the money for the payment before it is late, then you need to contact your mortgage lender immediately and let them know. There may be options for you with them so that the payment does not show up as being late.
Foreclosure is extremely serious, and can make it very difficult for you to obtain any type of credit at all in the future. Missing your mortgage payments reduces your credit score, and a foreclosure or evidence that you have been 120 days late on your mortgage will make it very hard to qualify for a refinance or a new purchase home loan in the future as well. Avoiding foreclosure by getting caught up is extremely important. You may be able to refinance to prevent or avoid foreclosure if you have a minimum 30% or more equity in your property.
If you think you may be late with a mortgage payment or are facing financial hardship call your lender immeadeately and let them know. Most lenders will be willing to work with you and develop a payment plan to help you stay current. They may not be as accommodating when you call them with a 90 or 120 day late.
When you miss a mortagage payment it can be very damaging to your fico score. Many times if you are behind 2-3 payments the foreclosure process will begin. A Notice of default will be filed at the county records office. In many cases you will still have time to save your home.
Even if you are just 32 days past due, your lender may not accept just 1 payment. They may require you to immediately bring your account up to date. It is very important to keep in contact with your loan servicer to work out a payment arrangement.
Depending on where the property is located, judicial foreclosures are common in some states while non-judicial process are customary in others. The basic difference between a judicial foreclosure and non judicial foreclosure is that the former goes through the court process whereas the latter requires no court actions.
This post has been filed under : foreclosure, forbearance, late, behind