Posted on: 17th Feb, 2009 03:21 pm
I'm looking at being 3 months late on the small HELOC loan I have on a rental home. Both my wife and I are on the mortgage.
How will this affect are credit scores. They are both quite high at the moment.
What are our options for working this out with the least amount of damage?
If I get more money in the near future can I offer to buy down the loan?
If I get the money later and bring the account current, will my credit go back up, or will the damage be done?
Thanks for any help.
Desperate! :(
How will this affect are credit scores. They are both quite high at the moment.
What are our options for working this out with the least amount of damage?
If I get more money in the near future can I offer to buy down the loan?
If I get the money later and bring the account current, will my credit go back up, or will the damage be done?
Thanks for any help.
Desperate! :(
Hi junk,
Did you inform the lender about your hardships? If you haven't, then the lender may start the foreclosure procedure. A foreclosure will badly affect your credit score and reduce it by 250 points. As your wife is also on the mortgage doc, her credit score will also be affected.
You can contact your lender and try for the option of loan modification. This will help you to save your property. In the process of loan modification, the lender will give you an alternative repayment plan so that you can pay off the dues. Moreover in a loan modification, your credit score will not be affected.
If you do not want to save the property, then you can try for a short sale or a deed in lieu foreclosure. Both the processes are more or less the same. The lender will sell off the property in both the processes to recover his debts. The deficient amount resulting from the sale of the property will be forgiven by the lender in case of a deed in lieu. But in case of a short sale, you will have to pay the deficient amount to the lender. To know more about deed in lieu, check out the following link:
http://www.mortgagefit.com/deed-lieu.html
Thanks
Did you inform the lender about your hardships? If you haven't, then the lender may start the foreclosure procedure. A foreclosure will badly affect your credit score and reduce it by 250 points. As your wife is also on the mortgage doc, her credit score will also be affected.
You can contact your lender and try for the option of loan modification. This will help you to save your property. In the process of loan modification, the lender will give you an alternative repayment plan so that you can pay off the dues. Moreover in a loan modification, your credit score will not be affected.
If you do not want to save the property, then you can try for a short sale or a deed in lieu foreclosure. Both the processes are more or less the same. The lender will sell off the property in both the processes to recover his debts. The deficient amount resulting from the sale of the property will be forgiven by the lender in case of a deed in lieu. But in case of a short sale, you will have to pay the deficient amount to the lender. To know more about deed in lieu, check out the following link:
http://www.mortgagefit.com/deed-lieu.html
Thanks