Behind on mortgage payments?

Maybe it's not you but someone you know - family member, friend or coworker?

Many homeowners find themselves in various situations causing them to struggle keeping up with their mortgage payments. Falling behind on mortgage payments can be a distressing experience, but it's important to remember that you're not alone. There are solutions available to help you navigate through this difficult period and avoid the unwanted consequences of defaulting on your mortgage.

There can be many different reasons why people fall behind on their mortgage payments. Job loss or reduced income is one of the most common causes. Unexpected medical expenses, divorce, or other unforeseen circumstances can also disrupt your financial stability. Regardless of the reason, it's crucial to take action as soon as you realize you may be unable to meet your monthly obligations.

One potential solution for homeowners struggling to make payments is a short sale. In a short sale, the homeowner sells the property for less than the outstanding mortgage balance, with the lender's approval. This can help homeowners avoid foreclosure and the credit damage that comes with it. However, it's important to note that a short sale may still negatively impact your credit score, although not as severely as a foreclosure. You can bounce back quicker from this option to purchase again in the near future because you took steps to help the bank recover a large portion of the outstanding balance owed on the home loan. This is a positive solution compared to the alternative.

Foreclosure, on the other hand, is a legal process in which the lender takes possession of the property due to the homeowner's failure to make mortgage payments. The bank loses the entire balance of the mortgage and has to list it as a bank-owned property to try and recover as much as they can. Foreclosure should be considered as a last resort, as it can have severe consequences, including long-term damage to your credit score and the possibility of eviction...which affects both renting and future purchasing. It takes several years to recover from this, but there are a few points where foreclosure can help you. It's important to connect with an expert and weigh all options - sooner rather than later.

When facing financial difficulties, it's essential to explore all available options and seek professional guidance. Consulting with a real estate agent or an attorney who specializes in foreclosure prevention can provide valuable insights and help you make informed decisions.

Remember, falling behind on mortgage payments is a challenging situation, but it's crucial to remain proactive and take advantage of the available solutions. Whether it's pursuing a short sale or exploring other alternatives, seek professional advice to help you navigate through this difficult time. The sooner you act, the better your chances of finding a solution that fits your unique circumstances.

- Melissa Minck, The Kameli Team - LPT Realty

Certified Distressed Property Expert (CDPE)