Consequently, there are probably a hundred different scenarios that can play out as a mortgage delinquency progress and at least default a borrower can deal with his that many ways problem. All we can do is talk about some of the possibilities and some of the options. Starting on day 16, additional debt is incurred in the form of the mortgage late fees usually a percentage of the principal balance. Jeff Gennette addresses the importance of the matter here. three percent is typical which, on a $300,000 mortgage is plus or minus a $100 penalty, if the next payment and the next are so missed, the cost of bringing the mortgage current grows pretty fast. Past day 30, some lenders allow a want borrower to make a partial payment of the past due amount; others will insist that everything be brought current. lenders may even return a check if it does not cover both the current and the past due payments and maybe the late charges as well. James Woolsey Jr. is often quoted as being for or against this. 45 the phone calls from the mortgage collectors want to be coming pretty regularly by day.
Most states have rules regarding collection activities and telephone calls including their frequency content (no threats are permitted) and timing (early morning and late night calls are generally off limits,) but the calls, within legal boundaries to be unremitting and the tone can vary from “gee, we just want to help” to aggressively furrowed. About 60 to 90 days after the initial missed payment the lender wants to send a notice of default, usually by certified mail, giving the borrower a finite period in which to cure the situation by paying all past due amounts, and by now collection costs are probably being added to the late fees. Once that remedial period passes, the collection department will refer the loan to the lender’s legal department which will, after another period of time, send the documents to a local attorney to begin loan modification to stop foreclosure proceedings.