Credit Scores and Foreclosure – What Happens To My Credit Scores?

Credit scores and foreclosure mix just about as good as oil and water – or BP and the Gulf of Mexico.
Seriously, all jokes aside, credit scores are seriously impacted by a foreclosure – but the damage to your credit scores didn’t start with the foreclosure.
Your credit scores are impacted the moment your mortgage company reports your first 30 day late payment. If you have had no prior missed mortgage payments you can expect to see your credit scores drop somewhere between 50-100 points with your first 30 day late payment that your mortgage company reports.
Your credit scores will continue on their downward slide if you do not get your mortgage payments caught up. In the unfortunate situation where you go into foreclosure and lose your home you can expect to see your scores drop up to 300 points.
Another factor on your scores is how you go about saving your home from foreclosure if you are fortunate to do so. If you are able to enter into a loan workout or forbearance program, or get a loan modification, or short sale your home, your scores are likely to go down, but they might not go down as much as if you go into foreclosure. They will also likely rebound quicker under these other situations as time passes versus a foreclosure.
Credit scores are impacted by many different factors – too many to list here – but safe to say, the more debt you have versus the total credit limits on all of your accounts the lower your scores. The more risky that you look the lower scores you will have. The more late payments the lower scores you will have. Read more Credit Score Factors

All said and done, a foreclosure can and most likely will stay on your credit report for at least 7 years. But, if things do not change, you will be able to get a mortgage on a new home in less time than that.
If you seek a free consultation about modifying your mortgage, please complete the form below. You may need some other type of real estate or mortgage related service, if so please complete the form below.