Failure to pay a mortgage results in a lowered credit score for every missed payment, according to Reuters. After several months of non-payment, the bank sends an eviction notice and eventually repossesses the home through foreclosure. Reuters notes that different states have different foreclosures processes, and in places like New York and Florida, it may be years before a house is foreclosed on for non-payment.Know More
Missing just one mortgage payment can cause a hundred-point decrease in credit score, says Liz Weston, author and credit expert. Lower credit scores make it more difficult to obtain financing for a new house, a loan for a car, credit cards and other services based on credit worthiness, like car insurance.
Stopping mortgage payments and having a home repossessed does not free the owner from IRS taxes, explains Reuters. If a homeowner owes more than the house is worth, and the bank repossesses the house, the homeowner must pay taxes on the missing amount. The Washington Post gives the example of a couple who failed to make their mortgage payments and ended up with a $30,000 tax bill after selling the home for less than the total owed on the mortgage loan. The Mortgage Forgiveness Debt Relief Act and Debt Cancellation spared homeowners from these taxes from 2007 until 2013, but the Act was not renewed after it expired at the end of 2013.Learn more about Law
Civil liability is the potential for responsibility of payment to an aggrieved party due to the violation of a civil law, tort, or breach of contract. Civil liability differs from criminal liability in that violations of torts or contract terms do not subject the liable party to punishment for a crime, though civil liability can include punitive monetary damages or other court enforcement, such as barring further instances of harassment.Full Answer >
If a workers' compensation applicant does not agree with the settlement amount, the applicant can proceed to a hearing or trial with the insurance company in order to win a higher lump-sum or weekly payment, states Nolo. Accepting a settlement means a guarantee of receiving money from the insurance company.Full Answer >
Copyright gives recognition and legal rights to works produced by artists, designers, authors and more, ensuring they receive full credit and payment for their work. Copyright essentially acts as a legal tool to prevent plagiarism and theft of written works. Individuals and firms, including artists, software developers and software companies, publishing agencies and marketing firms rely on copyright protection to receive credit and pay for work, which helps them stay in business and creates broader economic benefits.Full Answer >
According to Credit.com, debt collectors can refuse partial payment unless the collector and the debtor previously negotiated acceptance of such payments. It points out that the debt collector may be allowed to charge extra in the event of state allowance or the collector including fees and expenses in the contract.Full Answer >