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Foreclosures Falling, But Mortgage Stress Continues

2012 May 30

By Tricia of Allsup

Foreclosures Falling, But Mortgage Stress ContinuesForeclosure filings fell to a five-year low in April, which is good news for the housing sector. But there are still thousands of people struggling—including those who have just experienced a life-changing disability.

 

Not being able to pay your mortgage can be very stressful. If you are in this situation, it is important to take action sooner rather than later. Sometimes we see this with people who call us about their situations, that they would prefer to bury their heads in the sand. It truly can be overwhelming.

The first thing to do, though, is to acknowledge that you are having difficulty paying your mortgage now, or that you will have problems soon. Although your situation may improve over time, failure to confront the issue head-on can lead to some dire consequences.

Hearing From Your Lender

If you receive a call or a letter from your lender, the best thing to do is respond.

Ignoring your lender will not make the problem go away, but can make it worse. Explain to your lender that you are having difficulty paying your mortgage as a result of your disability. Your lender may have some options for you, depending on your situation.

Another issue to discuss with your lender is making partial payments. Once you are behind on your mortgage, many lenders will only accept the total amount that is currently due. If you send in a partial payment, it may be applied to your escrow account rather than your mortgage, thereby making you even further behind.

If you cannot get help from your lender, you may have other options. New federal and state mortgage assistance programs become available all of the time.

The best way to see if there is a mortgage assistance program available to you is through the U.S. Department of Housing and Urban Development (HUD).

To find a HUD counselor in your area, go to http://www.makinghomeaffordable.gov/ or call (888) 995-HOPE (4673). HUD also provides a Housing Counseling Help Line at (800) 569-4287.

Find more information about mortgage and foreclosure issues online in Allsup’s Avoiding Foreclosure section.

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