5 Major Consequences of Late Mortgage Payments in 2022

Missing a mortgage payment is more common than you might think, with nearly 5 million American homeowners missing at least one payment in 2021. So if you’ve found yourself falling a little behind, know that you’re not alone, and there are things you can do to improve your situation. But knowing the potential consequences of late mortgage payments is just as important as knowing your options.

Keep reading to learn five major consequences of late mortgage payments in 2022. 

When is your mortgage considered late?

It takes some time for your mortgage payment to be considered late. If it’s just a day past due, you won’t incur any fees or penalties. Lenders provide homeowners with a 15-day grace period before charging late fees, typically 4% to 5% of your monthly payment. 

Even though your payment is considered late during the 15-day grace period, it won’t be reported as late. It’s not until 30-days have passed that your mortgage company reports it as late. Try to pay your delinquent mortgage as soon as possible, within the initial grace period.  

The consequences of late mortgage payments in 2022

Yes, you initially have some time to get caught up, but late mortgage payments still come with some major consequences, including:


Being late for 30-days isn’t the only time you’ll assess a fee. The longer you’re late, the more it costs to repay. Each month you fall behind, additional fees will be tacked on.


After the one-month mark, your missed payment will officially get reported as late to the credit bureaus. This means that your credit score will dive, affecting your ability to obtain additional credit. If your mortgage is more than one month overdue, then it will be reported every 30-days. 

Limited options

Lower credit means fewer opportunities to improve your credit. Your mortgage account will not be in good standing, and your FICO score will drop. Once caught up, missed payments can still affect you. Items on your credit report stay for seven years, affecting your chances of getting approved for credit years after you’ve reconciled the account. 


If you’re unable to pay your mortgage for 120-days, your lender can begin foreclosure proceedings

If things get to this point, there isn’t much you can do. You may have a few options, like potentially getting a loan modification through your lender or filing for bankruptcy. But these solutions aren’t guaranteed to work and can cost you even more. 

What to do if your mortgage is late

While it’s stressful, it can cost you money, credit, and home. So what should you do if you’ve fallen behind on your monthly payments? Here are three options. 

Repay the loan

If you can, try to repay your loan as soon as possible. Even if you’ve had late payments reported to the credit bureaus, it’s still worth it to try and repair the situation. Mortgage providers are willing to work with you and have different repayment options. However, it’s best to work out a repayment plan as soon as possible to prevent foreclosure.

Short sale

Sometimes repaying the loan just isn’t realistic. Maybe you’ve lost a job or been hit with unexpected expenses. You may need to sell your home, but when you’re late on payments, this can present another set of challenges. 


You won’t be able to sell it the traditional route with a real estate agent on the market. Your mortgage lender will only accept an offer that’s less than what you owe on the house. This is known as a short sale. 

In many cases, this is beneficial as the lender might waive your responsibility for any remaining balance. But this isn’t always the case, and you may still owe. On top of that, this will get reported negatively on your credit, affecting your chances of finding another place. 

Sell for cash

If you can’t find a way to repay and a short sale will leave you in another difficult situation, you should consider selling for cash. With a cash sale, you can potentially pay off your loan balance in one lump sum and even have money to start over. Plus, you’ll be able to sell your home as-is without worrying about marketing, extra fees, and long closing periods. 

Simply has the solution

Simply can help you get above water if you’re late on your mortgage payment. We’ll purchase your home for cash, with no hassle, lengthy closing times, or extra fees. Don’t allow things to get out of hand, and take control instead. 

Receive your offer today to get started!

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