Today, foreclosure rates are down, but as the economy worsens, more US homeowners are at risk.  Mortgage payments that were affordable when markets were flush, may stress the cash flow in the coming months. 

Photo by Juan Pablo Arenas from Pexels

If you find yourself unable to make the mortgage payments, take these steps to reduce the stress in a mortgage default or foreclosure situation:

  1. Take your lender’s or servicer’s calls.  Let them know what you are trying to do to resolve the default.  Avoiding calls from your mortgage company may speed up their decision to foreclose.
  2. If your situation is temporary, ask for a forbearance, a period of reduced or non-payments.  If income resumes next month, perhaps the two month hiatus can get you back on track.
  3. Keep a log of every spoken and written communication with your mortgage company.
  4. Ask where to submit a request for mortgage assistance.  Send the request along with all required documents either by a trackable mail service or trackable electronic submission.
  5. Make sure your name and mortgage account number is on EVERY page you submit.  Enter it in the same location on each page where possible.  This can reduce lost pages.
  6. Follow up.  Do not wait for your mortgage assistance representative to reach out to you.  If it has been a week or two since you had any communication with them, call and find out the status of your request.
  7. If you cannot get help from your mortgage company, or if you feel you are getting different stories from them, it may be time to consider getting legal representation from an attorney in your jurisdiction.
  8. Regardless of whether you hire an attorney or work directly with your  mortgage company, keep a copy of every document you submit or receive regarding your mortgage.  Make sure you understand each correspondence.  If you do work with an attorney, ask them to explain any documents that you do not understand. 

This is your home, and it is important for you to be involved in the fight to protect it, but if your attorney is speaking on your behalf, your involvement can be a supporting role to your attorney.  Mortgage companies sometimes attempt to circumvent attorneys in hopes of saving money or trapping you into new agreements.  Make sure your attorney gets a copy of every communication in a timely manner, and conference your attorney into calls direct from your lender.