If you don't have enough cash to make your entire mortgage payment, but could pay some of it on time, does the lender have to right to refuse your payment and give you a bad credit rating?

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Unfortunately, yes. If you make a partial payment, then you are not making the loan payment according to the terms of your mortgage. The contract, which is the note, outlines the term of repayment. All payments must be made and accepted according to the terms of your mortgage note. Normally, the lender will return your partial payment and report you as "late" to credit bureaus. This is to avoid seeming to agree to a lower payment, because in business law, allowing a breach in your contract (like letting someone make a partial payment) can actually alter the agreement. Some lenders may hold a partial payment in a "suspense" account until the entire installment is received.

How about those who made extra principal payments and paid their balance down beyond what was required? Haven't they earned the right to skip a payment or two? Unfortunately, no. The terms of the loan probably don't permit it. Troubled homeowners may be able to negotiate a loan modification in they are allowed to skip one or more payments (this is referred to as a forbearance). The missed payments may be tacked on to the end of the payment schedule, or they may be included in a second mortgage. The moral of this story, though, is that the solution must be negotiated--you can't just arbitrarily decide that you have earned the right to skip a few mortgage payments. That's a quick way to end up with the foreclosure police at your door.

This really is not a situation where your rights are being violated. Communication with your lender if you expect to have or are having financial problems is probably your best bet. Your workable solution is one that you and your lender agree to--not something that you just decide to do on your own and hope the lender will go along with.