What Are My Options?
Special Forbearance.
Your lender may be able to arrange a repayment plan based on your financial situation and may even provide for a temporary reduction or suspension of your payments. You may qualify for this if you have recently experienced a reduction in income or an increase in living expenses. You must furnish information to your lender to show that you would be able to meet the requirements of the new payment plan.
Mortgage Modification.
You may be able to refinance the debt and/or extend the term of your mortgage loan. This may help you catch up by reducing the monthly payments to a more affordable level. You may qualify if you have recovered from a financial problem and can afford the new payment amount.
Partial Claim.
Your lender may be able to work with you to obtain a one-time payment from the FHA-Insurance fund to bring your mortgage current.
When your lender files a Partial Claim, the U.S. Department of Housing and Urban Development will pay your lender the amount necessary to bring your mortgage current. You must execute a Promissory Note, and a Lien will be placed on your property until the Promissory Note is paid in full. The Promissory Note is interest-free and is due when you pay off the first mortgage or when you sell the property.
Deed-in-lieu of foreclosure.
As a last resort, you may be able to voluntarily "give back" your property to the lender. This won't save your house, but it is not as damaging to your credit rating as a foreclosure.
Pre-foreclosure sale.(Short Sale)
This will allow you to avoid foreclosure by selling your property for an amount less than the amount necessary to pay off your mortgage loan.
Bankruptcy.
This will allow you to enter into a payment plan or a complete forgiveness of all debt. This has severe credit consequences and should only be done on a last resort scenario. |
