Are you are falling behind on your mortgage payment and facing the worst case scenario of foreclosure? If you are worried you are headed in that direction then you must act immediately to maintain as many options as possible. Your situation may not be as bad as you think, or it may be worse, but the most important thing is to know where you stand.
First things first…
1. Call your lender immediately. If you are late with a payment or going to be then you need to take advantage of any grace periods they offer.
2. Apply for financial hardship to give you the opportunity to get back on your feet.
3. Freeze your finances. Do what ever you can to minimise outflow and increase the inflow of cash. Increase your work hours, get a second job, and cut your unnecessary expenses.
4. Prioritise your bills by paying all your secured debts first, then homeowners insurance, utilities and grocery bills then unsecured debts.
5. Know who to contact. Have a list of people that you can call on for assistance like family and friends, financial counsellor, bank manager, solicitor, that you can call on for advice.
6. Gather your important documents like the mortgage paperwork, deed of trust or contracts. Banks statements, notice of defaults and a current appraisal. Why? Then it’s handy for trips to the financial planner or bank manager.
7. Research information on negotiating or consolidating your debts. Finding options like a Debt Agreement to freeze interest and reduce the debt repayment amount on your unsecured debts might free up more cash for your mortgage payments.
8. Talk to your lender as soon as possible about your need for assistance. Hardship is something lenders must consider. And we have a template here for you to use so you can ask correctly. They may also have a support option in place called Forbearance. Forbearance is where a credit provider may postpone your payments for six months to a year due to hardship. However, interest continually accrues during this period and lenders and loaners should not enter into a forbearance arraignment without understanding the terms and risks. It may mean increased lending or longer maturity dates. But in the right circumstance, with legal advice, it might be the breathing space you need to get back on track.
Don’t wait until it’s too late…
If you’re facing financial hardship we are here to talk about a solution. Call us on 1300 887 211 or Book a Free No Obligation Phone Consultation with our friendly team and we can discuss debt management options specially focused on your personal situation.