Reports concerning the real estate market here in the United States have been somewhat positive over the last few months. Specifically, they indicate that the foreclosure rate has abated somewhat, while home sales have picked up in some of the nation's larger urban centers.

While this is certainly encouraging, experts are indicating that we have a long way to go, as a large number of Americans are still dealing with underwater mortgages, foreclosures and mortgage delinquencies.

To illustrate, a recent report by the Mortgage Bankers Association found the following:

  • At the conclusion of 2011, roughly 7.58 percent of all residential loans were delinquent, a decrease of 2.42 percent from 2010 but still higher than the pre-recession average of 5 percent
  • At the conclusion of 2011, 12.63 percent (one out of every eight homeowners) were delinquent on their mortgage payments or in foreclosure

While it's certainly understandable how people could have trouble making their mortgage payments during these tough economic times, experts are nevertheless stressing the importance of making mortgage payments on time whenever possible.

Most lenders adhere to relatively strict guidelines concerning mortgage payments. In most circumstances, these mortgage payments are due on the first of the month with a 15-day grace period. However, the failure to get the money to the mortgage lender within this time window can have significant consequences.

For example, if the payment is just one day late, some mortgage lenders will charge a late fee equivalent to 2 to 5 percent of the mortgage payment. (However, this may sometimes be waived).

Not surprisingly, the longer mortgage payments are delayed, the more drastic the consequences:

  • If 30 days have passed with no mortgage payment, a lender may notify the credit bureaus, which means the late payment will show up on your credit report for as long as seven years and cause serious damage to your credit score
  • If over 120 days have passed with no mortgage payment, a lender may initiate foreclosure proceedings

If you are experiencing any of these problems, consider contacting an experienced legal professional to learn more about bankruptcy and foreclosure.

Stay tuned for more from our San Antonio bankruptcy blog ...

This post is for informational purposes only and is not to be construed as legal advice.

(Please note: The firm handles only bankruptcy matters and is not involved in any pending class action lawsuits against banks/mortgage lenders. We take pride in reporting matters that are important to our community.)


The New York Times, "Paying on Time" March 8, 2012