Quincy Foreclosures and Credit Cards

It’s logical sense that staying current on your credit card payments will protect your credit rating.

However, when the weight of an adjustable rate mortgage or recent job lose is bearing down on a home owner and foreclosure is eminent credit cards are the last thing home owners think about.

Distressed Quincy home owners should be very careful in their decision on what bills should and should not be paid. Allowing monthly credit lines to become delinquent can negatively affect credit ratings.

This effect might not be as severe as a foreclosure, but all the ‘little stuff’ adds up and can prevent a future loan from being issued.

If you are in a situation where foreclosure is eminent the best thing to do is stay current on all the ‘little stuff’ and just allow the mortgage to go delinquent.

It’s far easier to ’short sale’ the existing home mortgage and wait the 2 year limit to obtain a new home loan, then it is to allow all the ’small stuff’ to become delinquent or charged off.

“staying current” doesn’t necessarily mean closing out all credit accounts. Keeping a few current revolving credit lines (i.e. credit cards) will actually help build credit during this period.

When applying for a new loan the banks want to see consistency on keeping current with credit payments.