The best thing you can do if you are behind on your mortgage payments is call your loan servicer. They can walk you through your options, explain the terms of each agreement and help you avoid foreclosure.
To start the conversation, consider the following questions:
Ask Yourself
- If my past due balance is paid, can I afford my regular mortgage payments going forward?
- What kind of mortgage do I have?
- Example: FHA, VA, RHS/USDA, privately held or conventional loan through Fannie Mae or Freddie Mac.
- The answer to this may determine which loss mitigation options, if any, are available for you.
- Is my COVID-related financial hardship temporary or permanent?
- If I qualify for a loan modification through my mortgage servicer, should I do that to address my delinquent balance and use the Homeowner Assistance Fund to help with other housing-related expenses, including utilities, taxes, insurance and homeowner's association fees?
Ask Your Loan Servicer
- Are you required to offer loss mitigation review of my loan based on the type of mortgage I have?
- If your mortgage is a FHA, VA, USDA or Fannie Mae/Freddie Mac Conventional Mortgage, the answer should be yes.
- Am I currently in a COVID Loss Mitigation Plan?
- If so, please explain to me which plan I am in and how it works.
- When will that plan end?
- Will I owe a large sum when my plan ends?
- If so, will that balance be added to the end of my mortgage?
- If not, what happens with that balance?
- What will my next option be if I continue to struggle with payments?
- My financial hardship is permanent (e.g. death of a wage earner). Do I qualify for a loan modification to lower my monthly mortgage payment to make it more affordable?
- If so, what do I need to do to start that process?
- If I use the Homeowner Assistance Fund Program to reinstate my past due balance, can I still qualify for that loan modification?
- Should I complete the loan modification first then apply for the Homeowner Assistance Fund Program?