Delinquency (Loan)
A borrower's failure to make required loan payments by the scheduled due date.
What is Loan Delinquency?
Loan delinquency occurs when a borrower fails to make a scheduled payment by the due date. Lenders classify loans as delinquent after any applicable grace period expires—typically 15 days for mortgages and shorter windows for other loan types—and report the delinquency to the major credit bureaus, which damages the borrower's credit score. Delinquency stages are tracked in 30-day increments: 30 days, 60 days, 90 days, and 120+ days past due, with escalating consequences at each stage including late fees, collection calls, and formal loss-mitigation review. A loan 90 or more days past due is typically classified as non-performing by lenders and banking regulators. Extended delinquency can lead to charge-off (when the lender writes off the balance as a loss), repossession (for auto loans), or foreclosure (for mortgages), depending on the loan type and collateral involved.
Example
A homeowner who misses a mortgage payment receives a grace period reminder at 15 days past due. At 30 days, the lender reports the delinquency to Experian, Equifax, and TransUnion, potentially dropping the borrower's credit score by 50–100 points. At 90 days delinquent, the servicer initiates formal default procedures and may begin the foreclosure review process.
Source: Investopedia — Delinquency