Avoid foreclosure
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The most important thing you can do when you’re having trouble paying your mortgage is to take action. In most cases, the worst thing you can do is nothing. The fear of losing your home through foreclosure can feel overwhelming, but you might have more options than you realize.
Whether you’re worried about missing a mortgage payment, or you’re already behind, contact your mortgage servicer right away.
Also, get in touch with a HUD-approved housing counseling agency. They can help you at low or no cost to you.
Options that can help you stay in your home
When you talk to your mortgage servicer, or a housing counselor, they might bring up the options below. Take a look at the descriptions and short explanations, to prepare for those conversations.
Refinance
Consider refinancing if interest rates for new mortgages are lower than the rate you have now or extending your loan term would lower your monthly payments, and if you haven’t missed any recent payments.
How it works: You get a new mortgage to pay off your existing mortgage. You apply with a lender, qualify for the new loan, and pay the associated fees. The new lender may be able to lower your monthly payment by getting you a new interest rate, giving you a mortgage that takes longer to pay off, or both.
PDF handout: Should I refinance?
Modification
Consider contacting your servicer for a loan modification if you can no longer afford to make your regular mortgage payment.
How it works: A modification changes the terms of your loan. All or some of your missed payments are added to the amount you owe. Your monthly payments could also be lower, but it could take longer to pay off your loan.
Find out more about mortgage loan modifications
Forbearance
Consider requesting forbearance from your servicer if you are having a temporary money setback like a job loss, illness, disability, or natural disaster.
How it works: Your mortgage payments are paused or reduced for a limited time while you get back on your feet. Forbearance doesn’t mean your payments are forgiven or erased. You can talk with your servicer about how to pay back your missed payments—over time, or when you refinance or sell your home.
See how to request forbearance
Look ahead to ways for exiting forbearance in future
Options for leaving your home
Leaving your home can be a difficult decision. You might want to, or need to, move out. But don’t just walk away. You might have options that are better for your finances and your credit.
Sell your home
Consider selling your home if it is worth more than you owe on your mortgage. Selling your home is typically better for your money situation and your credit than letting it go into foreclosure, doing a short sale, or getting a deed-in-lieu of foreclosure.
How it works: You sell your home, yourself or through a real estate agent. You use the money from the sale to pay off what you owe on your mortgage in full, pay the costs of selling, and keep any remaining funds. You don’t need approval from your mortgage servicer to sell your home, but it can help to notify them of your plans.
Find a housing counselor to talk about this option
Request approval for a short sale
Consider asking for approval on a short sale if our home is worth less than what you owe on your mortgage.
How it works: With a short sale, you are responsible for finding a buyer for your home. You’ll need approval from your mortgage servicer to complete a short sale and have the difference between the sale amount and your outstanding loan balance forgiven by your servicer. If you have other mortgages on your home, you’ll also need approval from the mortgage servicers of those other mortgages to complete the sale and to have your outstanding balances for those loans forgiven.
To qualify for a short sale, you will need to request a loss mitigation application from your servicer, send in a complete application and supporting documents, and receive approval from your mortgage servicer and the owner of your loan. Make sure you understand the terms of your specific short sale, including tax implications.
Find out more about short sales
Offer a deed-in-lieu of foreclosure
Consider a deed-in-lieu if you are ready to turn over your home and move out.
How it works: You can use a deed-in-lieu to turn over ownership of your home to your mortgage servicer and move out. You are not responsible for selling your home.
Qualifying for a deed-in-lieu of foreclosure could mean you don’t have to pay any amount remaining on the mortgage after you move out of your home—an amount called a “deficiency.”
To qualify for a deed-in-lieu, you need to get a loss mitigation application from your mortgage servicer, submit a complete application with supporting documents, and be approved to move forward with it by your servicer.
Find out more about deeds-in-lieu
These options are typically less expensive and take less time than foreclosure. They can also do less damage to your credit.
Get expert help
Talk to a housing counselor
For help talking to your mortgage servicer or understanding your options, contact a HUD-approved housing counseling agency in your area. Housing counselors can develop a tailored plan of action and help you work with your mortgage company, at no cost to you.
Talk to a lawyer
If you need a lawyer, there may be resources to assist you, and you may qualify for free legal services through legal aid. If you’re a servicemember, you should consult with your local Legal Assistance Office .
Submit a complaint
If you have a problem with your mortgage, tell us about your issue—we'll forward it to the company and work to get you a response, generally within 15 days.