Why You Should Never Miss a Mortgage Payment1/19/2011 You’ve just made your first home purchase and you’re ready to begin paying your mortgage. You were a good first time home buyer and you took special care to calculate what your mortgage payment would be before you took out the loan. But something has gone wrong. A few months into your new mortgage, you miss a payment. What happens? Nothing, at first. If you missed your payment by just a few days, nothing serious will happen. Your lender will likely charge you a minor fee and simply watch you a bit more closely in the future, but this isn’t a catastrophe. If you’re 30 days late, you’re in trouble. At 30 days late, your missed payment will show up on your credit report and reduce your credit score accordingly. This can have major negative financial effects all across the board. Other creditors, such as credit card companies, will notice this missed payment within the following few months. They will raise your rates and bring up other clauses to force you to pay more. Once you miss three payments, the lender will likely start to foreclose. You don’t want this. Your lender will be charging you late fees, your other creditors will have raised your rates, and you’ll be stuck in a legal proceeding that will likely cost you your home. This is why it’s important to never miss a mortgage payment. If you think you might miss a payment in the future, contact your lender. You may be able to work out a temporary modification option. |
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