Solving Mortgage Payment Problems
Dealing with the mortgage payments on your home can be a difficult process at times. If you fall behind on them, you will want to work to get back on track as soon as possible, since any delays are likely to make the problem more and more severe. In order to determine which path to take, you must first understand the difference between a fixed-rate mortgage and an adjustable rate.
Common mortgages include hybrid adjustable rate mortgages (ARMs), standard ARMs and fixed rate mortgages. For the first two, your interest rate changes over time, except for in the case of hybrid ARMs that begin at a fixed rate and then become adjustable. Fixed rated mortgages remain that way unless your tax or insurance status changes.
If and when you fall behind on payments for a hybrid or standard ARM, inquire with your lender to see if you can refinance the loan at a fixed rate. Be careful, as some ARMs involve pre-payment penalities that are levied if you refinance.
For mortgages in general, you'll want to contact the provider of the loan as soon as you begin experiencing payment problems. In order to qualify for a mortgage change under the Making Home Affordable Program, your home must be your primary residence, you must owe less than $729,750 and you must have suffered a serious financial hardship, such as sudden unemployment, that has left you unable to pay.
More likely than not, you'll need to provide documentation to back up your application for loan modification. This may include your most recent tax return, recent pay stubs and income information, bank statements, account balances on credit cards amounts owed in various loans and a Hardship Affadavit form.
Have you been experiencing difficulties with your mortgage lately?