Need help with mortgage payment

Do not procrastinate if you need help making your mortgage payments.

The federal government has created several programs to help struggling homeowners stay in their homes. The government designed these programs to help everyone who needs it. Some programs are for people who have made all of their payments but the value of the home is less than their loan. Others are for people who are having issues making their mortgage payments and are facing foreclosure. Sstart the process with a simple phone call.

Contact a U.S. Department of House and Urban Development (HUD)-approved housing counselor. This is the first step to determining which program is right for your situation. HUD only approves nonprofit counseling services who agree to provide free foreclosure prevention counseling. To find a housing counselor near you, call HUD toll-free at 800-569-4287 or visit its website.

Choose which option is best for your situation. Your housing counselor will help you decide which program is best. The government will not make your mortgage payments for you through this program. Instead, they encourage mortgage lenders to offer loan forbearance and modifications to homeowners struggling to make their payments. Loan forbearance is when the servicer agrees to accept either partial payment or no payment at all for a temporary amount of time. This is designed to help those who only need it temporarily. Loan modification permanently lowers the mortgage payment by lowering the loan amount or interest rate on your loan.

Call your servicer and request to speak to a forbearance or modification specialist. Your lender will require you to fill out specific paperwork to apply for this program. This can be much like applying for a new loan, as income documentation may be required. If you choose to modify your loan, the lender will ensure that the new payment does not exceed 31 percent of your gross monthly income (amount before taxes and deductions).

Pay your new mortgage payment on time during the trial period. Your loan modification will require you to test the new payment for a few months. If you miss any payment, your modification may be canceled and the old terms of your loan will still apply. Once you successfully make it through the trial period, your loan will be permanently modified and your new payment will be the permanent monthly payment amount.

Tip

• Work with your housing counselor throughout the process. If you have questions, your housing counselor can help you understand everything the lender is telling you. If something doesn’t make sense, ask questions until it does.