We Can Seek Justice Together

How long could I keep my home before it goes into foreclosure?

On Behalf of | Nov 30, 2021 | Foreclosure Defense |

An occasional missed mortgage payment does not usually cause you to lose your home. As reported by GoBankingRates.com, lenders generally offer a grace period.

Some lenders, for example, have a 15-day grace period. If you make a payment within that time, your account could remain in good standing. Your lender, however, may add a late fee of up to 6% of your monthly mortgage payment to your next statement.

How does a late mortgage payment affect my credit?

One missed mortgage payment typically does not harm your credit score. Some lenders report a second occurrence to the credit bureaus. After two months of missed payments in a row, however, most lenders consider an account in default.

When missed or late mortgage payments appear on your credit report, you may have a difficult time refinancing your home loan. If you find yourself temporarily struggling with your finances, you could contact your lender and ask for a forbearance or modification to avoid an upcoming foreclosure.

When may a lender begin the foreclosure process?

After 90 days or three missed payments, lenders usually send a demand letter requesting money to bring the account in good standing. Borrowers then have 30 days to catch up on their missed payments.

If you ignore your lender’s demand letter, you might give up the chance of working out a payment arrangement that allows you to keep your property. Lenders could allow as many as four missed payments before beginning the foreclosure process.

A notice received from your lender’s attorney does not always indicate that your home has gone into foreclosure. You may still have an opportunity to work out an arrangement with your mortgage holder.