Even with a steady paycheck, many Americans struggle to keep themselves afloat financially and are often only barely able to pay their dues, including their mortgage. So, when the unthinkable happens and they lose their jobs, they’re often forced to foreclose their home.
The truth, however, is that there are other options.
They may not always be agreeable and that you may have to act fast, but, at the very least, it’s better than losing your house.
1. Reach out to the lender
Believe it or not, lenders can be very understanding when it comes to late payments, especially when it comes to mortgages, and for good reason – they’d rather much deal with allowing you to extend your loan (and get a bit more money in return) than have to deal with selling a foreclosed property, which may not always net them profit.
Don’t wait for the lender to send you letters and phone calls. Act first and let them know what happened.
In most cases, the lender will allow you to come into a forbearance agreement, where you are allowed a few months of no payment in exchange for a higher interest rate or something else. You can also check in with your lender if they offer other modification programs for your mortgage to make the payments easier for you, either temporarily or until your debt ends.
Regardless of whatever agreement you come into with your lender, it’s always best to contact them as soon as possible.
2. Check if you’re qualified for the HUAP program
The HUAP program, otherwise known as the Home Affordable Unemployment Program, is a supplemental program offered by the federal government for citizens who can no longer afford to pay their mortgage after losing a job.
The program allows for the possibility of a forbearance period for those who are qualified, wherein mortgage payments can be suspended for a set period of time, or even reduced.
Keep in mind that the program has strict eligibility requirements,
Please head on over to the Home Affordable Modification Program page to apply for the program.
3. Sell your house before it is foreclosed
If all else fails, you can always sell your house. At the very least, you’ll be able to get some money out of it and not lose your property for nothing.
There are many ways to sell your house. Traditionally, you can list it and put it up for sale, either with the help of a real estate agent, or, you can also try selling it on your own. Both of these methods can be time consuming, not to mention expensive. Most home buyers aren’t looking to buy homes that need to be repaired – they want to buy a house that they can move in to right away.
Between the costs of repairs and renovations and fees for the real estate agent, you might not even be able to clear yourself off of all your debt despite selling your property.
An easier way to get out of your mortgage debt is to contact a cash buyer.
Cash buyers will buy your house as-is, without requiring you to do anything. All you need to do is to let them know that you’re selling your house, and they’ll make you an offer. It’s up to you if whether or not you’ll accept the offer, or if you think you’re better off trying your luck in the open market.