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Can I get mortgage with good credit scores but recent late payment
Can I get mortgage with good credit scores but recent late payment?
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Indeed, it is possible to secure a mortgage even with good credit scores. This is despite having made a late payment recently. The worst thing anyone can have is a recent late payment in the past twelve months. You can have outstanding collections, charge-offs, and late payments over twelve months or older. However, a recent late payment triggers concerns to creditors, especially mortgage lenders. One 30-day late payment may not be a deal killer, especially if you have other credit tradelines that have been paid timely. Nevertheless, this can prove to be quite difficult. Below are some of the things that could determine whether or not you qualify for a mortgage:
How Late It Was Made And How Severe The Situation Was: Normally, lenders will consider how late the payment was (30, 60, or 90 days) and when it happened in relation to now. A thirty-day late from several months ago might carry less weight than sixty or ninety days just last year.
Your Complete Credit Profile: If there is only one recent late payment alongside an otherwise strong borrowing history, the pros might be more lenient towards such cases. Any other part of your profile, including but not limited to debt ratios (DTI), income levels, and employment records, would also be considered.
The Loan Type: Every loan program has guidelines concerning late payments. FHA loans may be more forgiving than conventional ones. For example, they may allow recent rates under specified conditions, especially if DTIs are low or savings are significant.
Explanation and Documentation: Lenders can also look for good reasons behind these defaults. This is especially true when they are caused by events beyond someone’s control, like illness, which only happens once in a lifetime. Thus, they require proof thereof, too.
Interest Rates Impact: Even if one qualifies for a mortgage, they should expect slightly higher rates after making late payments recently. According to them, you become somehow riskier. Hence adjusting rates accordingly.
Compensating factors: Other positive aspects, such as substantial savings and low DTI, can help alleviate the impact of defaulting on your repayment plan at some point.
If you’re worried about how this might affect getting approved for another loan, try contacting different lenders. They will consider everything else besides the fact that somebody once failed to honor their obligations.