What is a common consequence of a default in a mortgage payment?

A common consequence of a default in a mortgage payment is the initiation of foreclosure proceedings. When a borrower fails to make their mortgage payments as agreed, the lender may take legal action to recover the amount owed on the loan. Foreclosure allows the lender to seize the property and sell it in order to recoup their losses. This process typically begins after a specified number of missed payments and involves several legal steps, ultimately leading to the sale of the property at auction if the borrower does not rectify the payment situation.

While refinancing of the mortgage, extending the payment term, or reducing the interest rate could be potential options in different circumstances, they are not typical consequences of default. In fact, they are more likely to be considered solutions or alternatives that a borrower might seek to avoid default, rather than outcomes that result from defaulting on mortgage payments. Thus, foreclosure proceedings are the direct and common response by lenders in such situations.