STEP 9:
What to do if you fall behind.

Prevent foreclosure.
Call your mortgage company BEFORE you fall behind on your payments. Don’t wait! This is the first common mistake borrowers make when faced with the inability to make their mortgage payments. When you are three or four months behind, (timeframes depend on various state laws), your mortgage company will initiate a process called a foreclosure, a legal procedure where a mortgaged property is sold to pay the outstanding debt in the loan. If this happens to you or someone in your family, you can get counseling and critical advice on how to avoid losing your home to foreclosure by going to the following sites:

• The U.S. Housing and Urban Development’s foreclosure site and 2,000+ housing counselors nationwide

• A video produced by the U.S. Dept. of Veterans’ Affairs

• Hope Now, an alliance of the federal government and members of the mortgage lending industry

• NeighborWorks America, a national nonprofit organization created by Congress to provide financial support, technical assistance, and training for community-based revitalization efforts

• The Foreclosure Prevention Assistance Center of the Mortgage Bankers Association

The best way to avoid foreclosure is to promptly contact your mortgage company before you fall behind on your payments. Your mortgage company is the only entity legally able to renegotiate the terms of your mortgage with you. They do not want you to lose your home. They too have a vested interest in assisting you to avoid foreclosure.