What is a common consequence for borrowers who fail to make timely mortgage payments?

When borrowers fail to make timely mortgage payments, one significant consequence is the initiation of foreclosure proceedings by the lender. Foreclosure is a legal process that allows the lender to reclaim the property due to the borrower's inability to meet the mortgage obligations. This typically occurs after a series of missed payments, usually defined by the state’s regulations or the specifics of the mortgage agreement.

Once a borrower is significantly in arrears, the lender may send notices and ultimately file for foreclosure if the situation does not improve. This can lead to the loss of the home and significant damage to the borrower’s credit score. The foreclosure process is designed to protect the lender's financial interests, as they will typically want to recover the funds that were originally lent for the property.

Other options, like increased credit scores, reduced interest rates, or opportunities for loan modifications, do not typically result from missed payments and are not relevant to the consequences of failing to make timely mortgage payments. Increased credit scores usually result from responsible financial behavior, and reduced interest rates might apply only under specific circumstances, like refinancing, which is not a direct consequence of missed payments.