Borrowers feeling the squeeze of late payments

Mortgage delinquencies and foreclosures rates are gaining momentum, even as fewer homeowners are falling behind on their monthly payments.

Mortgage delinquencies and foreclosures rates are gaining momentum, even as fewer homeowners are falling behind on their monthly payments.

According to The New York Times, mortgage data indicates that nearly 7.58 percent of all residential home loans were delinquent at the end of 2011 - a significant improvement from a high of 10 percent in 2010. However, when combined with homeowners who are in some stage of the foreclosure process, 12.63 percent of borrowers are feeling the real estate pinch.

In a stabilizing but still shaky industry, experts says it's crucial for borrowers to make their payments on time, as fewer lenders are giving as much leeway to households making late payments.

The newspaper says that prior to the housing market collapse, on average, borrowers had as much as two weeks after the due date to submit payments before feeling the financial impact. Today, this grace period has been shortened to just five days by most lenders. Any payments submitted after this time will likely result in a late fee of 2 to 5 percent.



blog comments powered by Disqus