Default
A mortgage default occurs when a borrower fails to meet the legal obligations of their loan agreement, most commonly by missing payments. Most loans enter default after 90 days of missed payments, triggering the lender's right to begin foreclosure proceedings. Default has severe consequences for your credit score and can result in loss of your home.
Default doesn't happen instantly with one missed payment — lenders typically consider a loan 'delinquent' after one missed payment and in 'default' after 90+ days. After the first missed payment, you'll receive calls and letters from the servicer. After 3 missed payments, the lender can issue a Notice of Default (in deed-of-trust states) or file for foreclosure (in mortgage states).
A default is recorded on your credit report and can drop your score by 100 points or more. It stays on your report for 7 years and makes it extremely difficult to obtain any credit during that time. The earlier you contact your lender when facing payment difficulties, the more options you have — including forbearance, loan modification, or a repayment plan.
Federal programs and most loan servicers are required to explore loss mitigation options before proceeding with foreclosure. If you're struggling, contact your servicer immediately, ask about hardship programs, and consider reaching out to a HUD-approved housing counselor at no cost.
Key Takeaway
A mortgage default occurs when a borrower fails to meet the legal obligations of their loan agreement, most commonly by missing payments. Most loans enter default after 90 days of missed payments, triggering the lender's right to begin foreclosure proceedings. Default has severe consequences for your credit score and can result in loss of your home.
Related Terms
Frequently Asked Questions
Most loans are considered in default after 90 days (3 missed payments), though lenders may begin contact and default proceedings vary by state.
Yes. Paying the overdue amount (plus fees) will cure the default. You can also explore loan modifications, repayment plans, or forbearance agreements with your servicer.
Default is failing to meet loan terms. Foreclosure is the legal process by which the lender takes ownership of the property after default — foreclosure can begin weeks or months after default.
Compare Mortgage Rates Today
Now that you know what default means, see how it affects your bottom line.
See Rates →