If you are behind in your mortgage payments or at risk of foreclosure their are several relief options you may be eligible for including refinance, modification, repayment plant, reinstatement, or forbearance.
With so many home owners struggling to make regular payments many people are searching for relief. The combination of a weakened real estate market and increasing payments is more than many property owners can handle. Because of the significant surge in mortgage defaults many lenders are willing to negotiate workout options with borrowers. If you are a home owner and at risk of foreclosure you may be eligible for one of the relief options listed below.
Mortgage Relief Programs
- Refinance – Mortgage refinance is when a home owner takes out a new mortgage with better terms or conditions and uses the proceeds to pay off the current mortgage. Depending on the equity in your home this may be an option.
- Modification – Loan modification is an agreement between a lender and borrower to change only certain aspects of an existing mortgage agreement. These changes can include reduced monthly payments or rate changes and usually make it easier for people to stay current with their home loan payment plan.
- Repayment Plan – A home loan repayment plan that provides a grace period for delinquent borrowers to repay late payments without repercussions. The late payments are normally added to the monthly payments for a fixed amount of time at the end of which the borrower is current.
- Reinstatement – If a lender allows a delinquent borrower to repay the total owed amount in one lump sum it is called loan reinstatement. This can be used in combination with forbearance if a borrower can show the lender that they will soon receive a large sum of money; often this includes a tax return, work bonus, or proceeds of a sale.
- Forbearance - A lender may offer forbearance, or a temporary suspension of mortgage payments or a reduction in monthly payments, if a borrower is currently in distress. This can be used if a borrower is experiencing financial hardship and is expected to recover with time. It is often granted with a repayment or reinstatement plans.
If you are struggling to make regular payments or worried about the threat of foreclosure there are several programs for which you may be eligible. With so many people behind in mortgage payments many lenders and the federal government have begun working to assist mortgage holders at risk of default. Speak to your mortgage company to determine what options may be available. They can help with the details of your mortgage and financial situation that will dictate what relief opportunities you qualify for.
