Getting behind in your mortgage payments costs you money in late charges and penalty fees that are added to your mortgage balance. Your credit score is going to take a pretty good hit as well. If you are currently in this situation, you aren't alone. About 5 million homeowners have trouble making their mortgage payments, according to MSN Real Estate. Even if feel like you'll never catch up with what you owe, help is available.
Consult with a housing counselor about the options available to you. Generally, housing counseling services are offered free or for a minimal fee. Contact the housing authority in your local community, county or state for a referral. You can also call the nearest office of the U.S. Department of Housing and Urban Development for the names of housing counseling services in your area.
Appeal to your mortgage lender for a repayment plan. A repayment plan allows you to spread the past due amount you owe over several months. Your lender will add the extra on to your current monthly mortgage payments until you get caught up.
Request forbearance if you expect your financial difficulties to be short-term. While your lender may be willing to suspend your mortgage payments for a specified number of months, you still have to repay the amount of payments you miss. The payments aren’t forgiven but are simply postponed. Eligibility requirements for forbearance vary among lenders.
Ask if your lender is willing to modify your mortgage loan. This may be an option if you can begin making regular payments again on time. Getting a lower interest rate or extending the term of the loan could make your mortgage payments more manageable. You will need to write a hardship letter explaining to your lender the reason for falling behind in your payments. Be honest with the lender and indicate how much of a monthly payment you can afford.
Inquire about the terms different lenders would offer you to refinance your mortgage. Start looking into a refinance loan before you fall too far behind. Waiting until you miss more than one mortgage payment will increase the interest rate you have to pay or get you denied for a new loan. The Mortgage Professor advises shopping other lenders first before approaching your current lender. You won't know if your lender is offering you a reasonable deal unless you know what else is out there.
Amber Keefer has more than 25 years of experience working in the fields of human services and health care administration. Writing professionally since 1997, she has written articles covering business and finance, health, fitness, parenting and senior living issues for both print and online publications. Keefer holds a B.A. from Bloomsburg University of Pennsylvania and an M.B.A. in health care management from Baker College.