What To Do if You Can’t Pay Your Mortgage

There are a couple of options available to homeowners who can’t pay their mortgage. The Cares Act provided forbearance programs to be extended numerous times for homeowners who lost their jobs or had their income cut. These forbearance programs allowed homeowners to defer their mortgage payments for up to a year by deferring them for six months and then extending them for another six months. The termination date of forbearance is determined by when the borrower began the program. For many, forbearance has come to an end or will come to an end soon. Other homeowners may be struggling to make their mortgage payments right now as their jobs and incomes fluctuate.

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Following the conclusion of their forbearance, homeowners may still be eligible for extra loss mitigation and services. Before and after forbearance, homeowners should seek help from their loan servicer or a housing counselor who can help them find possibilities. Freddie Mac and Fannie Mae still offer active forbearance assistance, and the Department of Housing and Urban Development, Federal Housing Administration, Agriculture Department, and almost all mortgage servicers will consider requests for forbearance at any time if the homeowner has a compelling reason.

In addition, the federal government established the Homeowner Assistance Fund, which is now operational in over 20 states. Homeowner aid programs are also available in many states. NeighborWorks America launched the Housing Stability Counseling Program to help nonprofits and agencies that provide direct counseling services to individuals and families facing housing instability. The Housing Stability Counseling Program, a federally funded program that provides counseling to households suffering instability such as eviction, default, foreclosure, loss of income, or homelessness, is the finest source of support for locating and sorting through services and possibilities. Many HUD-certified housing counseling services participate in the program, and they can assist homeowners in understanding the federal and state programs that may be available to them in their specific situations, such as mortgage delinquency and default.

If the homeowner is at risk, they should immediately contact their loan servicer to identify loss mitigation strategies. The sooner homeowners seek help, the more likely they are to identify the best loss mitigation strategy for their specific needs.

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