If you have fallen behind in your mortgage payments the first thing to do is to sit down and ask yourself, why am I behind?
Some possible answers might be:
- Loss of employment
- Loss of income because of illness
- Overextended
- Mismanagement of funds
- Is this a temporary or permanent situation
Once you determine the reason go to the next step, work on your budget:
- Write down your combined net monthly income (take home pay)
- Write down all of your monthly expenses
Before you call your mortgage lender answer the following:
Do your expenses exceed your net monthly income?
If so, do these figures include hefty credit card payments (unsecured debt)?
If it does, you may want to contact us for a debt management counselor who can help with your unsecured debts.
A counselor may be able to help you by reducing your monthly credit card payments enough to move you from a negative to a positive cash flow. If after contacting a counselor you are still in a negative cash flow situation a Counseling Specialist at InCharge Housing Counseling will be happy to provide valuable information to you. However, if after contacting a counselor your situation is improved or your cash flow is positive there may be a solution to your mortgage problem and the following steps should be followed:
Notify your lender in writing and follow up with a phone call.
- Be open, honest and willing to commit to fulfilling your obligation to pay your mortgage payments.
- Be prepared to send your lender a copy of your financial package including a written budget.
- Present proof of your situation (Reason for the delinquency, doctor bills, unemployment, injured on the job, etc.)
- Present a repayment plan that is affordable to you and one you think your lender will accept (A lender will normally extend a repayment plan up to six months)
- If arrangements are made with a lender to bring your account current always keep to the original arrangement that was agreed upon.