A strategic default is when a borrower intentionally stops making payments on their loan, even though they are still able to do so. The borrower may do this because they believe that the value of the property is less than the amount they owe, and they want to force the lender to take a loss. Strategic defaults can have a negative impact on the borrower's credit score and may make it difficult to get a loan in the future. Can you buy a house if you have a foreclosure on your credit report? Yes, you can buy a house after a foreclosure. However, it may be more difficult to obtain financing and you may end up paying a higher interest rate. Additionally, the foreclosure will remain on your credit report for seven years, which could make it difficult to qualify for other loans during that time.
What happens when a loan goes into default?
When a mortgage loan goes into default, the lender can begin the foreclosure process. The foreclosure process involves the lender taking back possession of the home and then selling it in order to recoup the unpaid portion of the loan. The borrower will still be responsible for any deficiency (the difference between the loan amount and the proceeds of the sale) after the foreclosure.
What is a hard default? A hard default is when a borrower stops making payments on their mortgage loan and the lender is unable to collect payments through other means. This can happen if the borrower becomes unemployed, has a medical emergency, or experiences some other financial hardship. The lender will typically initiate foreclosure proceedings after a hard default.
What is a technical default?
A technical default occurs when a borrower fails to meet the terms of their mortgage agreement. This can include missing a mortgage payment, failing to make insurance or property tax payments, or violating the terms of the mortgage in some other way. Technical defaults can often be cured, meaning the borrower can take corrective action to bring their account back into good standing. However, if a technical default is not cured, it can lead to a foreclosure.
What happens when a credit card goes into default?
When a credit card goes into default, the credit card company will report the account to the credit bureaus as delinquent. The account will then appear on the borrower's credit report as delinquent. The credit card company may also close the account and send the account to a collection agency.