[Max's Mommy]

...will this affect our credit? We own a house that we rent out and our current tenants are really screwing us over. We are current as of right now, but we will have to miss October's payment. I called our lender to see if we can defer a payment- they said we can, but we still have to pay interest, which is most of the payment anyway, so we can't do that either. How badly will this affect our credit missing just one payment? We have never missed one before and we have excellent credit.

[bonedaddy315]

Although you cannot know for sure the exact impact of something like this, without getting your credit score before the missed payment and comparing it to the score after the missed payment, there is a really good website that you can use to get a report card on your credit. The website is Credit.com It is free but will only give you letter grade (A, B, C, etc.)If you go to myfico.com, and pay $ 16, you can get a copy of your credit report (you only really need 1 of the three credit bureau reports - they are essentially the same)I believe the myfico.com site - as part of your $ 16 charge - also offers a service that will tell you the effect of certain actions, like missing a payment.I will say that if at all possible you do everything to avoid a missed payment (maybe a credit card advance or line of credit, if you have one) but I'll also say that some people mistakenly believe they need perfect credit (the max score of 850) The truth is a score of 780 will get you all the credit benefits of a score of 850.Good luck !

[Mortgagemeg]

There are a couple of issues to take into consideration. First, if you are late on a payment, but it gets to your lender and is credited to your account on the 29th day after the due date, it cannot be reported to a credit bureau as a late payment. Payments are only reported to credit bureaus as late if they are received exactly 30 days or more after the due date. If you plan on going this route, make sure that you not only pay the total payment, but also any late fee. If you do not include the late fee, it is technically not a full payment, and that can be reported as a late payment to credit. Also, this gets to be a sticky situation if it leads to a long line of late payments. For example, if you make a payment on the 25th day of the cycle and that wipes out your cash flow so that you can't make another payment until another 30 days have gone by, so you have another round of late fees on top of the original payment, and so on. But, if you are going to be renting this property and you know that you will be receiving rent to allow you to make the next payment on time, paying that one payment on the 29th day, might not be a bad option.Second, there are generally non-profit organizations within most metropolitan areas, who will negotiate on behalf of a borrower with the borrower's lender for free. For example, in Columbus, Ohio there is an organization called Columbus Housing Partnership. I have been involved in a situation where they were able to negotiate with a lender to allow payments to be added to the end of the mortgage and remove reporting of any late payments, as those payments were now due at the end of the loan. Just be careful when searching for a similar organization that it is a real non-profit and will not charge you for the service. Some so called, "credit counseling or credit protection agencies," can sometimes be quite expensive, charging an upfront fee of hundreds of dollars and as much as 10% of each payment made through them in additional fees. Check with your local Chamber of Commerce for a community agency who will assist you for free.Finally, if you must miss a payment by 30 days or more; one will hurt, but more than one will be excruciating. If all of the rest of your payments are reported as being paid on time and you only have one 30 day late payment on your mortgage account, you will probably recover your good credit rating after 12 months of perfect credit reporting after the late payment. Interestingly, there is actually a ranking of which type of account activity impacts credit scores most. The ranking is: 1st - mortgage payments, 2nd - installment accounts, like car payments or student loans, 3rd - credit card or revolving debt. So the mortgage payment history counts more heavily towards your credit score calculation than similar payment history on a credit card account.