If your mortgage due date comes
and goes and you can't make your
payment because of a job loss or similar situation beyond your
control, you must act quickly in order to save your home. Pick
up the phone and call your lender because they can probably help
protect your credit and keep you in your house. You can often
renegotiate your mortgage terms in crisis situations like this
with a little effort on your part.
When you ring your lender, they will probably ask you if you
have a temporary loss of income or if your financial state of
affairs is more critical. If you've lost your employment, and
forthcoming payments are in peril, let them know immediately
because there are some measures you can take right away to
reduce or prevent the possibility of foreclosure.
What measures can be used to help you depends on the type of
mortgage loan you have. If you have a conventional loan, lenders
can probably examine your financial situation and work out a
resolution that is beneficial to both you and the lender, in
short order. If your loan is government backed or insured,
government rules may preclude your lender from talking over
alternate alternatives with you until you are ninety days in
arrears. Regardless of the type of loan you have, you must
communicate with your lender as soon as possible about your
financial troubles.
Here are seven things your lender may be able to do to help you:
1) Forego late payment fees, 2) Give you a long-term period of
time to get caught up on your payment: perhaps as long as one -
two years, 3) Accept the receipt of a partial payment, 4) Move
your present payment to the end of your loan, giving you the
necessary time to get your finances back on track, 5) Accord you
a separate interest-free or low interest personal loan for the
sum of your missed payment, 6) Refinance or re-amortize your
present loan, 7) Give you an interest or principal decrease on
your present loan.
Your lender has no inherent desire to foreclose on your home;
they want to keep you in your home paying your mortgage loan
monthly. While they would prefer that your payment come in each
month in a timely manner, you would be surprised how many
lenders are empathetic to the many financial troubles borrowers
sometimes have in making their mortgage payments. If your lender
is made aware of the difficulties you are having they will do
their best to help you out. However, it is your responsibility
to inform your lender that you are having financial problems
Not all lenders can extend borrowers the seven renegotiation
measures mentioned above, but your lender probably has many of
these options available to help you out. Obviously, you do need
to qualify for this assistance from your lender. You may be
mandated to provide proof of income loss, in addition to a
thorough financial statement. Don't let pride or embarrassment
keep you from making that crucial call to your lender if it can
help keep you in your home.
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