If I can't pay my mortgage loan, what are my options?
If you can’t pay your mortgage or are worried about missing a mortgage payment, call your mortgage servicer right away. You should also contact a HUD-approved housing counseling agency to get free, expert assistance on avoiding foreclosure.
First, call your mortgage servicer. You can find the telephone number for your mortgage servicer on your monthly mortgage loan statement. If you don’t get a monthly mortgage statement, look in the mortgage loan coupon book your lender gave you. You can also look on your mortgage servicer’s website. If you don’t know the name of your mortgage servicer, contact a HUD-approved housing counseling agency for help.
When you call your mortgage servicer, be prepared to explain:
- Why you are unable to make your payment
- Whether the problem is temporary or permanent
- Details about your income, expenses and other assets like cash in the bank
- If you are a servicemember and have received permanent change of station (PCS) orders. (This is important to mention, because you may qualify for loss mitigation options because of your military move.)
Many mortgage servicers have programs to help people avoid foreclosure. Your mortgage servicer will look at your situation to consider the options that may be available to you. The servicer may ask you to fill out a mortgage assistance application. After the servicer reviews the completed application, it will let you know what loss mitigation options, if any, it will offer to you.
Next, call a HUD-approved housing counseling agency. Through the Department of Housing and Urban Development (HUD), you can find an agency to help you. The counselor can:
- Discuss your situation and whether you qualify for any programs or additional help
- Help you understand the loss mitigation options your servicer offers and which options might work best for you
- Guide you through the process of working with your servicer and any other programs and paperwork you may need
- Help you at little or no cost with budgeting, credit card debt, or other financial problems that may be making it hard to pay your mortgage
You can use the CFPB's "Find a Counselor" tool to get a list of housing counseling agencies in your area that are HUD-approved. You can also call the HOPE™ Hotline, open 24 hours a day, seven days a week, at (888) 995-HOPE (4673).
If you are facing imminent foreclosure or have been served with legal papers, you may also need to consult an attorney.
What options might be available?
Some options that your servicer might make available include:
- Get a loan modification
- Work out a repayment plan
- Get forbearance
- Short-sell your home
- Give your home back to your lender through a “deed-in-lieu of foreclosure”
Watch out for Scams
A HUD-approved housing counseling agency can help you figure out which available options may work best for you. You don’t have to pay anyone to help you avoid foreclosure. The help you need is available at no cost to you from your servicer, or through a HUD-approved housing counseling agency.
Foreclosure scammers might tell you they’ll save your home from foreclosure, when they’re really just taking your money.
Watch for these scam warning signs:
- You’re asked to pay upfront for help.
- The company guarantees it will get the terms of your mortgage changed.
- The company guarantees you won’t lose your home.
- You’re asked to sign over title to your home or to sign other documents you don’t understand.
- You’re instructed to send your payment to someone other than your mortgage company or servicer.
- The company offers to do a “forensic audit.”
- You’re told to stop paying your mortgage.
- The company says they’re affiliated with the government, or uses a logo that looks like a government seal but is slightly different.
Tip: Use our checklist for more information on how to avoid foreclosure.