questions & answers

Question: Are the lenders able to work with you even if your only 1 month behind. they sent us a letter giving us a certain date to catch up and what would happen if this didn't occur.

Answer: Most lenders prefer to work with borrowers, as it is not in their interests to go to foreclosure. It is expensive for them, mortgage insurers, and investors. A letter such as the one you received likely has instructions on calling the lender. It is very important to respond or the lender will be required to start legal action leading to foreclosure and this will increase the cost of bringing your loan current. If the letter does not have instructions on who to call, look for customer service numbers on your monthly mortgage billing statement, your payment coupon book, or the lender’s website. The farther you get behind on your payments, the more difficult it will become to work out different options. Don’t lose valuable time by thinking your problems will quickly correct themselves. Don’t be embarrassed about any financial difficulties you may be experiencing or be concerned about the lender rushing to foreclosure. While there is no guarantee that any relief will be given, most lenders are willing to explore every possible option. When you call, be ready with (1) your loan account number, (2) a short account of your situation, (3) recent income documents (pay stubs, benefit statements, etc.), and (4) a list of household expenses. Be honest about your situation and be willing to work to a solution. If the problem is temporary, these options might be available: •Reinstatement: Your lender is always willing to discuss accepting the total amount owed to them in a lump sum by a specific date. They will often combine this option with a Forbearance. •Forbearance: Your lender may allow you to reduce or suspend payments for a short period of time after which another option must be agreed upon to bring your loan current. A forbearance option is often combined with a Reinstatement when you know you will have enough money to bring the account current at a specific time in the future. The money might come from a hiring bonus, investment, insurance settlement, or a tax refund. •Repayment Plan: You may be able to get an agreement to resume making your regular monthly payments, in addition to a portion of the past due payments each month until you are caught up. If the situation is long-term or may affect your ability to bring your account current, the following options might be available: •Mortgage Modification: If you can make the payments on your loan, but you do not have enough money to bring your account current or you cannot afford the total amount of your current payment, your lender may be able to change one or more terms of your original loan to make the payments more affordable. Your loan could be permanently changed in one or more of the following ways: o Adding the missed payments to the existing loan balance. o Changing the interest rate, including making an adjustable rate into a fixed rate. o Extending the number of years you have to repay. •Claim Advance: If your mortgage is insured, you may qualify for an interest-free loan from your mortgage guarantor to bring your account current. The repayment of this loan may be delayed for several years. Expect to have more than one phone conversation with your lender. Your lender may mail you a “loan workout” package with information, forms and instructions. If you want to be considered for assistance, you must complete the forms and return them to your lender quickly. The completed package will be reviewed before the lender talks about a solution with you. The sooner you call, the sooner help is available. If you don't feel comfortable talking with your lender, you should immediately contact a HUD-approved housing counseling agency and arrange an appointment with a counselor. A counselor will help you assess your financial situation, determine what options are available to you, and help you negotiate with your lender. A counselor will be familiar with the various work-out arrangements that lenders will consider and will know what course of action makes the most sense for you and your family, based on your circumstances. In addition, the counselor can call the lender with you or on your behalf to discuss a work-out plan. You can also get an automated referral to the three housing counseling agencies located closest to you by calling 1 (800) 569-4287. You can also call 1(800) 569-4287 or go to the HUD website.


  • Are the lenders able to work with you even if your only 1 month behind. they sent us a letter giving us a certain date to catch up and what would happen if this didn't occur.




  • Please select your county of residence below.



  • State Bar of Arizona
  • Maricopa County Bar
    Referral number 602-257-4434
  • Pima County Bar
    Referral number 520-623-4625
  • National Domestic Violence Hotline
  • Bankruptcy Court Self Help Center
  • Certified Legal Document Preparer Program


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