Credit lines

[Anonymous]

I've had perfect credit for 25 years never missed any payments.   I currently have a total of 110k in credit card lines.    If I stop paying my mortgage will my credit card banks lower my lines and/or suspend my accounts?   I'd like to know how the credit card banks would react to missed mortgage payments and possibly foreclosure.   Thx.  

[Anonymous]

Nobody can say for sure but yes if your mortgage is reporting active lates adverse action on your revolving credit accounts would not surprise me at all.  It would even seem likely.  What is your current utilization % on your credit cards?  I would say someone who has $0 credit card debt with 110k available and deliquent mortgage is exceedingly rare.  Why not pay your motgage with your CCs?  If you truly have lower utilization % your lenders might give you some more rope but you're probably still looking at adverse action

[Anonymous]

Your credit score will drop due to the missed payments and then it will take them forever to file the actual foreclosure, all the while your payments will report late every month until the foreclosure finally stops the bleeding. it is highly possible that some of your cards will balance chase you down when they do their regular soft pulls. I know some are more aggressive than others on this. Any way to refi while your credit is still good or try to sell the house? Even maybe take some money out of one of the cards until you can somehow get more funds? I know that's likely paying more interest but at least you won't ruin your credit and lose your house?

[Anonymous]

I've got 90k borrowed on credit cards all at 0%.   I've been doing big credit card promos for several years on four different cards.  If I stopped paying my mortgage do you think they would close my accounts?  Or maybe lower the credit lines to just over my balances?  

You asked why not pay my mortgage on credit cards?   I will need to qualify for apartment the rest of my life.   As a landlord taking my application, would you rather see a foreclosure and a perfect 20 year credit card history.   Or would you rather see a paid off house and 20k in credit card defaults or settlements?  

[Anonymous]

My income dropped from 65k to 22.5 k Ssdi.   No way to refi and I don't qualify for loan mods.   I have to decide between forclosure or credit card default.  Can't stay in house on this income.   assume I can't do a short sale.  I have a heloc too.  

[Anonymous]

I'm so sorry to read this OP. I don't know how old you are, but I'm thinking in this situation I might just file BK on both the house and the credit cards because it will ruin your credit no matter what choice you make but at least with the bk you can get out from under debt and open up your cash flow plus you can bounce back from that in a few years. But I'm no finance expert. I would usually never give that advice but obviously something pretty significant has happened in your life. Maybe someone else can give better advice.

[EW800]

When I went through a foreclosure and a CC settlement about 3-1/2 years ago, only Amex balance chased me down.  All others left me alone, I assume because I was still making more than the minimum payments.  Although Amex balance chased me down, I was able to get the CL back up again significantly about a year after the foreclosure was complete.  I could see that the other CC companies were watching me though - soft pull account reviews like crazy, especially CapitalOne.  

[Anonymous]

Also they won't close your accounts. The May balance chase you but they will likely keep your accounts open. If that helps.

[EW800]

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@Anonymous wrote:

My income dropped from 65k to 22.5 k Ssdi.   No way to refi and I don't qualify for loan mods.   I have to decide between forclosure or credit card default.  Can't stay in house on this income.   assume I can't do a short sale.  I have a heloc too.  

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If you have not already, you may want to go over to the Foreclosure area of this forum as well.  There is a LOT of good advice there.  You have a lot to think about, especially with the HELOC being involved as well and whether you are in a no-recourse state and or not, and so on.  

[DeeBee78]

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@Anonymous wrote:

My income dropped from 65k to 22.5 k Ssdi.   No way to refi and I don't qualify for loan mods.   I have to decide between forclosure or credit card default.  Can't stay in house on this income.   assume I can't do a short sale.  I have a heloc too.  

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If I had that choice, I would choose to default on my cards. I'd rather have a roof over head than a piece of plastic.