What is a Mortgage Default?
A mortgage default is a situation in which someone is not making payments on his or her mortgage, and the loan is considered to be “in default,” meaning that the agency which holds the note can choose to take over the property. Defaulting on a mortgage can result in the loss of a piece of real estate, and it should be avoided at all costs. Even if the property is not lost to the bank, a mortgage default will drag down a credit score significantly, making it harder to negotiate with the bank or to secure credit for other loans in the future. When a mortgage is issued, a monthly due date for payments is usually specified. Many mortgages include a grace period of one to two weeks, meaning that payments sent during the grace period will still be considered on time. After the grace period has elapsed, however, late fees will start to be levied. If more than 30 days after the due date go by, the mortgage is considered to be in default. Once the bank determines that the 30 days has elapsed, i
• A mortgage default is when you have missed 3 or more payments on your home (90+ days). At this time the lender will start the Foreclosure proceedings with their attorney. Most lenders will stop taking your payments at this time even if a payment is sent in to them. Foreclosures are very costly to the lender and they are now trying to avoid them. Communication with the lender is the key at this point. Calling the lender after the first missed payment can be very beneficial as lenders are more willing to work with people at this point to try and avoid the foreclosure process. Every lender will handle this differently. Depending on how many payments have been missed, a Work Out Plan may be best to bring your mortgage current. If the reason for the delinquency is a temporary situation, ie. temp job loss,and you can prove your income has returned to normal, then a restructuring of the payment to bring the mortgage current maybe in order. Most Work Out Plans will have specific deadlines to
A mortgage is considered to be in default when one or more monthly payments have been missed. What solutions are available if I am in default on my mortgage payments? You may qualify for a broad range of help. Some solutions are: • Short Sale/Payoff • Forbearance Agreement • Loan Modification • Deed in Lieu of Foreclosure What is a Short Sale/Payoff? Short Sales occur when borrowers sell their properties for amounts that are less than the amounts owed to the lender. How do I qualify for assistance? Borrowers need to prove that they are experiencing a substantial financial hardship. What is a “Hardship”? A hardship is a situation that has a life changing effect for the borrower that results in an in-ability to pay the mortgage debt in either, short or long term. Some examples are: • Separation or Divorce • Medical Bills • Inability to work due to health reasons • Death of Spouse • Job Relocation • Reduced Income or Unemployment • Business Failure How do I apply for help? Contact us and
A mortgage is considered to be in default when one or more monthly payments have been missed. What solutions are available if I am in default on my mortgage payments? You may qualify for a broad range of help. Some solutions are: Short Sale/Payoff Forbearance Agreement Loan Modification Deed in Lieu What is a Short Sale/Payoff? Short Sales occur when borrowers sell their properties for amounts that are less than the amounts owed to the lender. How do I qualify for assistance? Borrowers need to prove that they are experiencing a substantial financial hardship. What is a Hardship? A hardship is a situation that has a life changing effect for the borrower that results in an in-ability to pay the mortgage debt in either, short or long term. Some examples are: Separation or Divorce Medical Bills Inability to work due to health reasons Death of Spouse Job Relocation Reduced Income or Unemployment Business Failure How do I qualify for a Short Sale? A borrower must prove that a hardship exists
