Asking Your Mortgage Lender for Help

By Karen Lawson Columnist

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You never thought it could happen to you. You've heard the news about foreclosures due to mortgage rate adjustments, but you thought you understood the terms of your loan.

On the other hand, no one expects medical emergencies or job loss. The best thing you can do if you are having trouble making your mortgage payment is to contact your lender. You may be embarrassed, but never mind. Your mortgage lender doesn't want to foreclose on your mortgage and take possession of your home. Instead, the lender may be able to assist by refinancing your mortgage, or granting an equity loan or line of credit.

Denial can be Your Worst Enemy

For some reason, humans seem to be hardwired for denial. You know you're in deep financial trouble, but tell yourself that you can put off the bill collectors for just a few more days. You have only part of this month's mortgage payment. Calling your mortgage lender may be difficult, but your lender may be able to help with a variety of relief options:
  • » Temporary forbearance: Your lender grants a specific time period for bringing your payments current. Temporary forbearance is best when you know you'll have the money to bring your mortgage loan current by a specific date.
  • » Repayment plan: Your lender may work with you to establish a repayment schedule. You will likely have to repay any late charges and sign a repayment agreement. Make sure you can honor the terms of your repayment agreement; if you have doubts, consider other alternatives.
  • » Refinancing or Home Equity Loan: If you've always made your payments on time until now, your lender may consider refinancing your mortgage or approve a home equity loan for paying off bills. These options can result in higher payments, but may provide the cash you need to get back on track.
Knowing your true financial picture and honest communication with your lender can help you work as a team to bring your mortgage payments current.

About the Author
Karen Lawson is a freelance writer with more than fifteen years of experience in mortgage banking. She holds BA and MA degrees in English from the University of Nevada, Reno.

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