Should you refinance your mortgage? Interest rates are trending up, but they're still at historic…
Are you asking yourself how to keep your home safe from foreclosure? Despite our rising economy, many Americans are still facing financial difficulties. No matter how hopeless it may seem, you have options.
You should always keep your lender informed if you’re having trouble making your monthly mortgage payment. Explain to the bank officer why you are having difficulty and how long you think you will be unable to pay your mortgage. Then you should ask the bank if they sponsor any programs that will help you keep your house. You should be prepared to lay out a plan for repayment of missed payments, too.
It’s understandably frightening to call the bank when you’re having financial difficulty, but it’s important to keep them in the loop is you want to keep your home safe from foreclosure. Additionally, you can follow these helpful tips from the U.S. Department of Housing and Urban Development (HUD).
Request Loan Modification
HUD offer several programs to help lower monthly mortgage payments. By requesting loan modification and refinancing to a lower mortgage rate, you can save thousands of dollars over the life of your loan. You will also save possibly hundreds on your monthly mortgage rate.
Programs available include:
- MHA The Making Home Affordable program has helped 1.8 million homeowners avoid foreclosure over the last seven years. Although the program is no longer accepting applications, mortgage companies are still working within the parameters of the program to help homeowners.
- The Freddie Mac & Fannie Mae Flex Modification Programs If your mortgage loan is owned by Freddie Mac or Fannie Mae, you might qualify for a special loan modification program called a Flex Modification. This program helps modify your mortgage loan which may lower your interest rate and/or extending the mortgage terms. re worth significantly less than the amount that is owed on their home.
- 2MP The Second Lien Modification Program helps homeowners who modified their primary mortgage under HAMP. If you have a second mortgage, you may be eligible for modification or principal reduction on your second mortgage.
Many homeowners have experienced a decrease in their home’s value. If you find yourself underwater with your mortgage, you may qualify for HLRO. You may also qualify to have your second mortgage reduced or eliminated through Treasury/FHA Second Lien Program, or FHA2LP.
Contacting Your Lender
If you are having difficulty discussing your financial situation with your lender, there are programs available to help you. The Federal Housing Administration (FHA) has staff available to answer your questions and assist you with other options to save your home. You can call the National Service Center at 877-622-8525. You can call the FHA Outreach Center at 800-225-5342
The Bottom Line
Nothing is hopeless when it comes to keeping your home. There are programs available to you and there are many people who want to help you. For more information on foreclosure and these programs, visit the HUD website. Additionally, for more tips to save your home and prevent foreclosure, take a look at this HUD pamphlet.