Perhaps you’re home has not foreclosed. Maybe you’re not even underwater on the mortgage yet. But any number of reasons can make you squeamish about the future prospects of holding on to the property: the loss of income, sudden expenses, or non-discretionary costs that continue to sap your earnings. Chad Graham at The Arizona Republic sets up a valuable process for getting up and doing something about unfavorable mortgage terms. Here’s a brief run-down:
1. Call your lender right immediately and inquire about any of the new government programs available to help struggling homeowners.
2. Get your paperwork organized.
3. Check out MakingHomeAffordable.com to see if you can qualify for help.
4. Find the toll-free number in your state for mortgage help and call it.
5. Check out HUD.gov to find out more information regarding help and programs.
6. Contact your lender repeatedly. The idea is to be polite yet persistent. Call with a clear agenda, ask lots of questions, but be friendly.
7. Trim from your expenses. Non-discretionary and discretionary costs should both be scrutinized. There’s no better time to set up and live by a budget.
8. Stay alert for mortgage scams.
9. Understand how the choice you opt for impacts your long-term finances. For example, short sales negatively impact your credit score very little compared to a foreclosure. Make sure to evaluate all options carefully before making a decision.
Raj Patel writes for DebtGoal.com, a do-it-yourself system for getting out of debt and lowering your interest costs. DebtGoal.com incorporates all of the techniques discussed in this post and can help users understand and get visibility to and manage their debt finances.
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