Can A Mortgage Default Send Me Into Debt?
Can A Mortgage Default Send Me Into Debt? Table of Contents If you’re facing a mortgage default or are having difficulties making your repayments on
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If you’ve received a default notice in regards to your mortgage repayments being overdue, you might be wondering if you will still owe money on your home loan. Generally, you will most likely still owe money on your loan, as a default does not make the overdue loan amount disappear. However, there are steps your lender mist go through before a default is listed on your credit file.
Read on below to find out more about mortgage defaults and what you will owe.
When you receive a default notice, it doesn’t mean that your debt is erased. You will still owe your usual repayment amount, and your lender might add on late fees. A default is a notice to tell you that you have fallen behind on your repayments. It is also to warn you that serious action could be taken to recover the overdue funds. Defaults aren’t used to erase any existing debt or mean that your repayments no longer matter. When you fall behind on your mortgage repayments, a default can be listed on your credit file.
However, before a default can be listed, your lender must let you know that they plan to report your debt to a credit reporting body.
In this initial notice, your lender will inform you that your repayments are overdue and request that a payment be made. After you have received your first notice, your lender will generally send a follow-up request for payment. Once these notices have been sent to you, your lender can notify a credit agency that your debts remain unpaid, and request that they add a default to your credit file.
Generally, a default will remain on your credit file for up to five years, which might make it difficult for you to get approved for a loan during that period. Even if you are able to repay your debt during those five years, your default will still remain on your file, albeit marked off as having been paid.
SR & Associates has more than 40 years of experience and has successfully helped 1,000’s of people Australia wide with mortgage problems, debt issues and bankruptcy.
We’re here to provide support services to those who do not know where to look, or who don’t know where to turn during the mortgage default process. You shouldn’t have to live in fear of being hounded. That’s why we advocate for our clients to help to stop them from being harassed by creditors and debt collectors.
Our helpful advocates can give you confidential assistance, and find a personalised solution that works for you. We can also assist you in finding a solution to your mortgage issues in addition to advocating for you. We believe in complete transparency, so you won’t get any nasty hidden fees from us. If you need help and support, call our supportive advocates for your free consultation today.
*Disclaimer: This article contains general comments and recommendations only. It is not intended to be and should not be construed as legal advice. This article has been prepared without taking account of your objectives, financial situation or needs. Before taking any action, you should consider the appropriateness of the comments made in the article, having regard to your objectives, financial situation and needs.
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