How to Get Help When Behind on Mortgage Payments

If you're behind on your mortgage payments, take action.

Homeowners can get behind on their mortgage payments because of job loss, illness and other unforeseen circumstances. When faced with this dilemma, it is important to act as quickly as possible to remedy the situation. The sooner the issue of late mortgage payments is addressed, the sooner a possible resolution may be reached. Some of the options a homeowner may utilize include speaking with the mortgage lender, contacting a government agency for assistance or calling an attorney.

Instructions

Mortgage Payment Options

1. Consult with a representative from a HUD-approved counseling agency in your community. The U.S. Department of Housing and Urban Development website provides a list of agencies located throughout the United States that assist homeowners who are behind on their mortgage payments. The services provided by a housing counseling agency are free of charge. A local counselor can assess your situation and inform you of the different options available, such as loan modification, forbearance and mediation.

2. Entering into a forbearance agreement is an option that may be available through your mortgage lender. Your mortgage payments may be reduced or suspended for a temporary period of time through a forbearance agreement. The homeowner will resume paying the mortgage and any accrued interest once the temporary period expires. Homeowners who qualify for a forbearance tend to be those who have not missed any mortgage payments prior to their current hardship and are dealing only with a temporary setback.

3. Contact the lender and find out how to apply for a loan modification. You may qualify for one of the modification options available under the Making Home Affordable Program, as explained on the website for the organization. Provide the lender with a hardship letter stating why you have been unable to remain current with the mortgage payments. Submit your most recent tax return documents and pay stubs to verify your income. Fill out paperwork listing all of your expenses. A loan modification may create more affordable mortgage payments.

4. Filing for Chapter 13 bankruptcy allows the homeowner to create a three to five year payment plan through the bankruptcy court. The homeowner can pay back the delinquent amount owed on the house over a number of years instead of in a few days, as requested in the pre-foreclosure notice. The lender will be prevented from selling the house as long as the property remains under the protection of the bankruptcy. Consult with a bankruptcy attorney to determine if this is the best option for you.

Tips & Warnings

• Attempting to create a repayment agreement with the mortgage lender can be a lengthy process and may take several months. It is important to continue to follow up with the mortgage lender and retain a copy of any financial documents forwarded to them and a record of communications with all representatives.

References

• U.S. Depart. of Housing and Urban Development: Foreclosure Avoidance Counseling
• U.S. Legal Definitions: Forbearance Agreement
• Making Home Affordable.gov: Frequently Asked Questions
• United States Courts: Bankruptcy
• Federal Trade Commission: Facts for Consumers