If you’re a homeowner, you know that missing your mortgage payment isn’t something to scoff at. Not only are late or non-payments likely to result in ongoing calls from your lender, but a late payment could also negatively impact your credit score.
What happens if I miss a mortgage payment?
It depends. If your payment is just late, it may not affect your credit score at all. Some lenders wait at least 30 days before submitting late payment information to credit reporting agencies. If you can make up your missed mortgage payment quickly, you should be fine. However, if your payment is more than 30 to 60 days late, it will likely appear on your credit report. If your payment is more than 90 days late, your lender could pursue foreclosure.
Does missing mortgage payments affect my credit?
Missing mortgage payments can affect your credit. On-time payments make up about 35% of your total credit score. If you have a history of late payments, this can lower your credit score. Lower credit scores make it difficult to qualify for additional loans.
How will missing one mortgage payment impact my credit?
According to FICO, a single missed payment could drop your credit score by 50 points or more at the 30-day mark. If the late payment reaches 90 days, the score could drop by nearly 200 points. The type of credit, debt-to-income ratio and credit age can affect how much damage a single missed payment will have on your score as well.
What are my options if I can’t pay my mortgage?
If you know you won’t make your mortgage payment, call your lender as soon as possible. If you have any mortgage loan that’s backed by Fannie Mae and Freddie Mac (FHA, HUD, VA, USDA, etc.), you’re legally entitled to protection through the CARES Act. Your lender can help you apply for forbearance and/or pause foreclosure proceedings.