March 22


What Are Your Options if You’re Behind on Your Mortgage

By Mike Nelson

March 22, 2022

Falling behind on your mortgage payments can become a stressful situation. If you don't get a handle on things right away, the problem can quickly snowball and become unmanageable. Luckily, some options can help you take care of this problem. Below, we'll outline some of the best options available to you, such as sell my house fast for cash or working with your loan provider to get a forbearance. 

Your Options If You Are Behind on Your Mortgage

Sell Your Home for Cash 

One simple solution for your if you are behind on your mortgage is to sell  your home for cash. By working with cash home buyers, like Coveway Properties, you can quickly get cash for your home, regardless of what kind of condition it’s in. You can then use this cash to pay off your current mortgage, thereby eliminating your late payment problem. 

Of course, this solution isn’t for everyone. You’ll have to ensure you’re getting enough for your home to not only pay off your mortgage but afford your next place. However, if you’ve been meaning to downsize, selling your home for cash right away can be a great solution especially when you’re behind on your mortgage . 

Options if you are behind on your mortgage

Set Up a Repayment Plan 

If you're not looking for a service that can help you "sell my house fast for cash," then the next option to consider is setting up a repayment plan. With a repayment plan, you work with the loan provider to disperse your late loan payments over a period. For example, if you owed $1,000 in late mortgage payments, you might agree with your loan provider to pay this amount back over one year, paying around $90 per month. This is a more manageable amount, allowing you to catch up on your loan payments. 

Repayment plans can be a good option if you’ve recently gone through a temporary financial setback that is now over. For example, if you were out of a job for a few weeks and unable to make your loan payments but are now employed again, you can use your new salary to make up for the time you were out of work. Talk with your loan provider about available options and see if you can arrange a repayment plan that works for you.

Explore Loan Modifications 

A loan modification alters the terms of your original mortgage agreement. Some lenders allow this if you experience financial hardship. For example, let's say you are five years into a 30-year mortgage when your income level decreases. You can keep the current principal owed but extend the loan back to 30 years with a loan modification. The result is that you now have lower monthly payments in exchange for extending the term of the loan. 

Think carefully before you seek a loan modification. Consider not only your monthly payments but the total amount paid by the end of the loan. If you're experiencing a temporary financial hardship, altering a long-term agreement may not make sense. Explore options like cash home buyers or loan modifications instead if you believe you will have a hard time paying your mortgage for a long time to come. Once you get the loan modification, you can use the new monthly savings to begin paying back your missed mortgage payments. 

Seek a Forbearance 

A forbearance is essentially a pause in your loan payments. Some loan providers, especially government-sponsored loan servicers, have criteria in place for who can receive a forbearance. You get a temporary pause on your mortgage payments if you meet the criteria, such as unemployment or a specific income level. You can then use this time to pay back the missed payments and establish a stronger financial foundation before the payments begin again. 

Keep in mind that you continue to accrue interest on your loan with forbearance. So, while you are not making payments, the total amount you owe rises. It's, therefore, important not to rely on forbearances too much as you want to keep paying down your principal as much as you can. 

House Garage

File Bankruptcy 

Filing bankruptcy is an option of last resort. There's a lot that affects the bankruptcy process depending on your situation, so it's important to explore everything before carefully deciding what to do. For example, you need to determine if you want to file Chapter 7 bankruptcy or Chapter 13 bankruptcy, as each impacts your debts differently. Also, you'll like to learn whether your home will be exempt or nonexempt in the bankruptcy process, as this determines whether you can remain in your home or if you need to sell it.

Talk to A Housing Counselor 

Consider talking to a housing counselor if you need help deciding about your late mortgage payments. There are counselors approved by the Department of Housing and Urban Development (HUD) and it's their job to guide people struggling with their housing finances. Housing counselors analyze your current financial situation and discuss all of your available options with you, whether that's getting a forbearance or finding a cash home buyer. 

When looking for a housing counselor, look for someone who received certification from HUD, as this demonstrates they passed certain testing requirements. Foreclosure prevention counseling services are available for free through HUD's Housing Counseling Program, so be sure to take advantage of this assistance if you need it.

Start Solving Your Mortgage Payment Problems Today 

The sooner you start taking action on your late mortgage payments, the sooner the problem goes away. If you decide that your best course of action is to sell your house fast, then Coveway Properties is here to assist you. Please get in touch with us today and we’ll walk you through the process of how selling your home for cash works. 

Coveway Properties makes the entire selling process easy and quick so that you can pay off your outstanding mortgage payments in a short amount of time. We hope that this article was able to provide you with some useful information and that before long, you’ll have your late mortgage payments under control and be well on your way towards financial stability.

"What a relief to have found Coveway Properties! My husband and I have been struggling with what to do with this home for years. Every time we had a game plan to fix up the home to sell it, one of us was getting sick or recovering from surgery.  Mike was so understanding and worked with us remotely to get the home sold. We are so grateful for his help!"