Maybe you want to renovate your house, buy a new car or pay an expensive bill. Or maybe you have overwhelming debts. In such situations, refinancing can be a lifeline for you. The trouble is, if you have late payments on any of your current debts, banks will not allow you to refinance, no matter what your current credit situation is.


Being turned down for refinancing when you need it most is stressful and frustrating. But don’t give up yet. Even if you’re in arrears on your current debts or if you’ve been turned down for some unknown reason, you do have options and can refinance.

Late vs Missed Mortgage Payments

In Australia, you have a “late mortgage payment” if you fail to settle the amount by the due date specified in your loan agreement. 


On the other hand, you have a “missed mortgage payment” if you extend beyond just being late and aren’t able to pay at all during the billing cycle. If your payment is overdue by 60 to 90 days, lenders may issue a default notice, giving you a further 30 days to settle the outstanding amount. If you fail to address a missed payment, it can lead to more serious consequences, including negative impacts on your credit report and potential legal actions by the lender to recover the debt.

What Happens If Your Mortgage Payment Is Late

You might be wondering: “Does a late mortgage payment affect credit scores?” Not if you can settle your payment within the grace period provided by most lenders, which is typically between 7 to 15 days past the due date. During this period, you can pay without significant penalties and without being marked “late”. 


If you make the payment after this grace period, you may be charged a late fee, which is added to your next repayment. The specifics can vary between lenders, so it’s important to understand the terms of your loan agreement.


However, note that if you make the payment more than 14 days late, it could be reported to credit bureaux and recorded as a “late payment” on your credit report. Regular occurrences can negatively affect your credit score, making it more challenging to secure loans or favourable interest rates in the future.

How Late Payments Affect Your Refinancing Ability

A late mortgage payment signals potential risk to lenders. Frequent late payments can lead lenders to view you as a higher credit risk, which could either result in you receiving a higher interest rate offer or your refinancing application getting denied.

Refinance When Your Payments Are Late

Have you had your application rejected by the bank? You’re not alone. Regulation changes have made it much more difficult to get refinancing approval, even for those with good credit scores. This rejection is confusing and frustrating, especially for those who know they can afford the repayments.


Don’t worry – that’s where we come in. Freedom Loans are refinancing experts and we can most likely help you, no matter how many times you’ve been told “no” before. Helping people with bad debt and late payments is our specialty.


The Australian banks may have become stricter, but refinancing is still possible when you know how. Reduce your stress and the time, admin work and effort you need to exert by letting us do what we do best. Contact us today, and let’s get the ball rolling.

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If you’ve been turned down by a bank – or more than one – because of bad credit, give us a call on 1300 364 751. We’ll tell you, straight-up, how we can help, so you can stop worrying and get back to living.

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