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There is some confusion with late mortgage payments and how they affect credit report and FICO score. You have to understand that if a payment has not been received by the due date, mortgage is technically considered delinquent, but a late mortgage payment is not going to harm either your credit report or your checkbook, as long as you are late within 15 day grace period. While all mortgage payments are paid in rears and due on the first of the month, e.g. your February payment is due March 1st, the lender does not do anything if payment is received by March 15.

If you are late on your payment by more than 15 days but less than 30, a late charge of 5% of the payment will be assessed if provided for in the mortgage note, and every mortgage note I have seen had such a provision. So if you make a late February mortgage payment of $1,000 on March 18, you will get a $50 late charge. Nothing shows on your credit report and your credit score does not suffer.

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Tags: Credit Report, Fico Score, Late Mortgage Payment, Score

I am asked almost every day, “What things affect my Credit Score the Worst?” It does not matter what your score is before the event. It only matters what your score is for the outcome. The higher your credit score the more that these events will affect the number and the lower the score the less it will affect your score.

The worst offender is a Bankruptcy. Bankruptcies will lower your score from the worst offender is a Bankruptcy. Bankruptcies will lower your score from 130 to 240 points right from the start. Depending how you monitor your report will depend on how much more damage other things report from the bankruptcy. The Bankruptcy alone will do 130 to 240 points but other items could do even worse so watch what is being reported.

Next on the list is a Foreclosure. If you can avoid a Foreclosure do so but if you can’t avoid one then be prepared for it to affect your credit by 85 to 160 points. Unlike a bankruptcy, a foreclosure generally only affects the foreclosure listing. Read full article…

Tags: Credit Score, Score, Things Affect

How to remove hard inquiries from credit report is the often-asked question. Also called hard pull. Many of you think that removing a hard inquiry or several, will greatly improve your credit score. While having many hard inquiries on your credit report can be quite detrimental to the credit score, the damage is quite limited if you have well-established credit history. Of course, I saw once the credit report of the fellow who was looking for construction loan. He was building, remodeling homes for a living and was quite successful in getting loans and flipping homes. That was till the point when some idiot of a mortgage broker promised him the moon and the sun, and few stars as well. He shopped his credit report with few dozens of different lenders. Each did a hard pull, resulting in close to 40 hard inquiries against his credit report within two weeks. Needless to say, his credit score went some 200 points down, from mid 700s to lower 500s.

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Tags: Credit Report, Credit Score, Score

Q: I am under impression that 30 day late payment does not affect credit score after 24 months. I have had one 30 day late credit card payment for 21 months. Initially, it did affect my credit score – it went down by 42 points on Experian. I had only 3 credit lines then. Now I have 5 and are shopping for a mortgage. Scores pulled by my credit union show 661, 667 and 694. They say that I should wait for a bit over 90 days, afterwards my 30 day late won’t matter, right?

A: Wrong, but not too bad for you in any case. First, after 2 years 30 day Lates still count, but much less. Call it a fading influence if you like. And the very fact that you have a derogatory record on the credit report may still affect lender decision. Now with credit unions you may have more issues than with commercial banks. It could be their policy that no matter how little that late payment affects your credit score, its mere presence in the last 2 years is against their lending guidelines.

Second, you can check with the lender that makes FHA insured loans.

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Tags: Credit Score, Day Late Payment, Late Payment, Score