Fall Behind on Your Mortgage? Get Back On Track Now!

Falling behind the mortgage can be a frightening situation. However, there are a few situations not in your hands that leads to delay in the mortgage payments. It is, perhaps, your largest investment and thus maintaining the consistency in the payments can be sometimes challenging. There are options available to get back on track.

Following are the ways that will help if you are going through a similar situation.

Identify the Root Cause

The first thing to consider is evaluating the root cause of falling behind on your mortgage. This might involve different scenarios. Home buyers often overlook these situations. Identifying what led you to miss one or more mortgage payments will help you determine the best option available for your situation.

The causes can be categorised into two – short-term hardship and long-term hardship. Short-term hardship involves reasons such as an unexpected increase in expenses, short-term disability or job loss. Long-term hardship involve reasons like permanent disability or job loss, death of the spouse or contributor to the mortgage, etc.

What Are the Consequences?

One of the major consequences of mortgage delinquency is its impact on your credit score. As the mortgage is the biggest responsibility anyone would have in life, it has a considerable impact on one’s credit score. For instance, if you miss one mortgage payment, it can reduce your credit score by nearly 100 points.

People might overlook the credit score thinking that they won’t be buying another home in the future. However, there are many other things where low credit score will impact the payments like car loans, home renovation loans, etc.

Don’t Walk Away

Even if you fall behind the mortgage payment, don’t walk away from the situation. Instead, find an outcome.

There are multiple ways to prevent foreclosure. People often have a misconception that mortgage companies are reluctant to help. On the contrary, mortgage companies have different options available to help you out of the situation. Mortgage lenders in MA or any part of the USA have a team to avoid the foreclosure.

There Are Options Available to Help

At Drew Mortgage Associates, our loan officers help you at every step of the way. Let’s clear out the misconceptions. Following options are open for you at different scenarios.

• Reinstatement

This is the quickest way to get your mortgage payment back on track. In reinstatement, you can pay a one-time lump sum amount of your past due payment. Once you pay your past dues, the loan does not go into delinquency.  It will stop impacting your credit score. However, make sure you continue the mortgage payment on time.   

• Repayment Plan

If you had a situation that falls into short-term hardships and your finance has returned to normal, repayment becomes the best option for you.

In a repayment plan, the mortgage company calculate the past due amount and split that amount over the months in addition to your normal payment. The mortgage company will consider the additional payment until you clear the dues. If you have a little extra income each month, this could be the best option to get back your mortgage payment on track.

• Loan Modification

If you are in a situation that falls under long-term hardship, this option will help you out. In this case, you should have an income source, but you do have to make up the past due amount out of pocket. The restructuring will settle your overdue payment is settled. This can extend the term of the mortgage with the altered interest rate to make it more affordable for you.

• Forbearance

Forbearance will not settle your dues, but it will help in case you have a short-term hardship that is unresolved. For example, extended unemployment, accident, etc. Forbearance will temporarily reduce your obligation. However, once you are out of the difficult situation, you will have to clear the dues either by reinstatement, repayment or loan modification.

If you find yourself falling behind of your planned mortgage payment, search for the option instead of walking away. If you are struggling to get on track for the mortgage payment, it is best to contact your mortgage lender to find the best alternative for you.

At Drew Mortgage Associates, the trusted mortgage lenders in MA, we have experienced loan officers that will help you ease the mortgage process from start till your closures.

Read Here : What Happens If You Skip Mortgage Payments?