Are you the type of person that struggles with remembering to pay their bills on time? You’re not alone. People across the country regularly submit late on monthly payments, inflicting terrible damage to their credit. Let’s take a quick look at how paying your mortgage or other late on monthly payments can have a negative impact on your mortgage.
As you already know, almost all banks, credit cards, mortgage companies and other lenders rely on your credit score to help assess the risk of lending money to you. Paying any of your payments late – even something as small as your mobile phone bill or a department score credit card – can result in negative remarks showing up on your credit score. If you are late enough times, or fail to repay the late payment in full. Then your score will start to drop.
If you already have a mortgage, then a lower credit score can be a problem when you try to refinance. The process of refinancing involves taking out a new mortgage, in which your lender will reassess your risk using your credit score as one of the indicators. If you have been making late payments. You might end up having to settle for a higher interest rate or you may even decline for the new mortgage.
Making A Late Payment? Contact Your Lender
If you are caught in a bind and have to make a late payment. It is best to get a call in to your lender as soon as possible. First, there may be a grace period in which you can be a few days late without any penalty. If that little bit of breathing room is all you need to caught up, you set. If not, you can let them know your circumstances and discuss what options you have.
It is essential to pay your monthly payments on time, even if it means making some small sacrifices in other areas. The better your credit score looks, the more opportunities you will have to make positive financial moves in the future. To learn more about monthly mortgage payments or to take out a mortgage of your own, contact us today. Our team of mortgage professionals is here to help you find a mortgage and buy the home of your dreams.