What to Do If You Are Behind on Your Mortgage Payments

Many homeowners have experienced a life change in the last few years that created a struggle in making their house payments on time. Some homeowners took advantage of the COVID forbearance programs, and are now realizing that there is still a debt due.

Many people do not know it is still possible to sell their home even if they are behind on mortgage payments. If you are in that situation, you can still sell your home, so if you are receiving notices from your lender, don’t ignore them. With the recent run-up in prices, don’t let yourself lose the equity that you have, just because you avoid the issue. Taking action can save you from the negative credit impacts of late payments or foreclosure – and taking action can actually help you land with money in your pocket!

#1): Contact your mortgage lender and ask about loan modification. Many areas have programs that require that a lender work with you on restructuring your loan. You may be asked to provide what is called “proof of hardship,” which just means you need to write an explanation of income change, job loss, death, divorce, medical issues, etc. Sometimes mortgage restructuring is not a long term solution because the loan is still a debt that you must pay – but a modification can be a great short term solution. It’s obviously not something lenders love to do, so be prepared for a bit of a runaround like lost paperwork and a slow process. Hang in there & stay involved every step of the way.

#2): Get a payoff quote for your mortgage loan. Not the amount on your coupon (that’s normally about one month’s payment amount off), but a payoff amount that you get from your mortgage company, good until a certain date. If you are concerned about not being able to sell it for more than is owed, one of our home advisors can explain what is called the “short sale process”. There is almost always hope and a strategy!

#3): Consider whether you want to have showings, open houses, repairs. If you are ready for the traditional sales process, then contact your favorite real estate agent. If you want to discuss your options for selling – including a quick sale process – then get in touch and let one of our advisors discuss options with you. Still Free. No Obligation.

Don’t Lose Your Home & Your Equity – Learn About Your Options