What to do when You’re behind on your Mortgage Payments

If you own a home and can no longer afford to pay the monthly mortgage, it can be hard to know where to turn. Below are some possible solutions to consider if you find yourself caught in this situation.


Refinancing may be an option for you. If the interest rate on your mortgage is higher than the current average mortgage interest rate, you may be able to lower your monthly payments by several hundred dollars. In order to take advantage of refinancing you must have good credit


If you cannot refinance, you may need to sell your home. If the home is worth more than what you paid for it and you can make a profit, then you can use that money to rent a home or apartment until your finances are once again secure. Although you may not want to sell your house, it is better to sell than go into foreclosure. You can always buy a home again but you can’t easily rebuild your credit history once it has been affected by foreclosure.

Short Sales

What do you do if your home is worth less than what you paid for it or less than what you owe? In this circumstance, selling your home is still an option. In this situation you should request a “short sale” from your mortgage lender. The first step is to put your home on the market and get a reasonable offer in comparison to other homes like yours. Once you receive a valid offer, write in the purchase contract that the sale is contingent on a short sale approval from the lender.

You will then need to submit a letter to your mortgage lender explaining your situation and asking them to accept the offer on your home as payment in full of your mortgage. If the request is reasonable, they may very well accept the short sale. Your lender will, however, need to go through a lengthy process of approval. This may take several months so they buyer should be made fully aware of this process before signing the.

The only setbacks of the s hort sale process are that you will need to continue making your mortgage payments until the lender renders a decision. You will not make any profit from the sale, however, your credit will still be in perfect condition and the mortgage debt will no longer be yours.

These are some options for you if you are facing monthly mortgage payments that you can no longer manage. If you are in this situation, it is important to speak to a financial advisor quickly before your credit is affected. Know that you are not alone and that there is light at the end of the tunnel.