Are you defaulting on a home loan and repayments? Is it the end of the world? Does defaulting on home loan repayments automatically mean foreclosure? Is this the start of the end of your most valuable dream and asset? How serious could this possibly be? How fast is fast when it comes to the reality that your bank can actually stake claim on your property? Before we can answer these questions, we must first be able to define what exactly does defaulting on home loan repayments mean, and what are the steps in correcting it.
Defaulting on home loan repayments - This is the act of negligence on the part of the borrower not being able to pay the agreed amount to the lender after a span of 15 days from the date of agreement. The date of agreement is usually on the first day of the month but in some instances it will also depend on the agreement between the borrower and the lender. Payments made after the date of agreement within the 15 day span normally would incur a certain amount of surcharge or penalty in favor of the lender. If payment is made by the borrower and penalties are settled within the 15 day period, this is not considered as defaulting on a home loan repayment, but simply a late payment and is not reported to the credit bureaus as late by the lender. Defaulting on home loan repayments is only considered when payment is not done within 30 days by the borrower and penalties and surcharges are not settled. If payment to the lender still isn’t made within the 30 day span, investigation from the side of the lender will be initiated.
Defaulting on home loan repayments and correcting it is the next step to be done after investigation is initiated. Once the investigation begins the bank would normally look into the borrowers financial capabilities. Before they get that far try your best to make amends with the bank. The best way of correcting this is by having open conversations with the different parties involved, by assuring them that you still have all intentions of paying. This would really help a lot instead of just trying to avoid these guys. If one tries to avoid his/her debts, sooner or later the good old collector will arrived. Believe me when I say that the collector never brings good news! Usually this ends up with the borrower in tears and a lot less assets than what he would normally have. Most banks are easier to talk to rather than trying to avoid them, they all catch up sooner or later. Most banks are even willing to help you by offering alternative ways of payments or differed installment plans ( a loan for your loan!). After defaulting on your home loan repayments for the third time, this is when foreclosure may be enforced. Once this is initiated there will be no turning back now, the bank may opt for publics auction of your property. This will mean the end for you my friend, and a new asset for our good old friend the bank!
Defaulting on home loan repayments and correcting it is the best action that one can possibly do. As a wise man said, “an ounce of prevention is always better than finding a ton of cure when the possibility of losing is evident!”
Defaulting on home loan repayments - This is the act of negligence on the part of the borrower not being able to pay the agreed amount to the lender after a span of 15 days from the date of agreement. The date of agreement is usually on the first day of the month but in some instances it will also depend on the agreement between the borrower and the lender. Payments made after the date of agreement within the 15 day span normally would incur a certain amount of surcharge or penalty in favor of the lender. If payment is made by the borrower and penalties are settled within the 15 day period, this is not considered as defaulting on a home loan repayment, but simply a late payment and is not reported to the credit bureaus as late by the lender. Defaulting on home loan repayments is only considered when payment is not done within 30 days by the borrower and penalties and surcharges are not settled. If payment to the lender still isn’t made within the 30 day span, investigation from the side of the lender will be initiated.
Defaulting on home loan repayments and correcting it is the next step to be done after investigation is initiated. Once the investigation begins the bank would normally look into the borrowers financial capabilities. Before they get that far try your best to make amends with the bank. The best way of correcting this is by having open conversations with the different parties involved, by assuring them that you still have all intentions of paying. This would really help a lot instead of just trying to avoid these guys. If one tries to avoid his/her debts, sooner or later the good old collector will arrived. Believe me when I say that the collector never brings good news! Usually this ends up with the borrower in tears and a lot less assets than what he would normally have. Most banks are easier to talk to rather than trying to avoid them, they all catch up sooner or later. Most banks are even willing to help you by offering alternative ways of payments or differed installment plans ( a loan for your loan!). After defaulting on your home loan repayments for the third time, this is when foreclosure may be enforced. Once this is initiated there will be no turning back now, the bank may opt for publics auction of your property. This will mean the end for you my friend, and a new asset for our good old friend the bank!
Defaulting on home loan repayments and correcting it is the best action that one can possibly do. As a wise man said, “an ounce of prevention is always better than finding a ton of cure when the possibility of losing is evident!”
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