Three Months Behind On Mortgage Payments...What Do We Do?
Donna and her husband have several debts and she wants to know how to keep the house out of foreclosure until they can get up to date on all their payments.
Answer: Budget based on your necessities: food, utilities, shelter, clothing and transportation. A traditional Fannie Mae mortgage will not foreclose on you in less than one month and, more than likely, it will be seven months. Between the regulations and the way a traditional mortgage company processes payments, they cannot jump through all the hoops to foreclose on you until seven months down the road. Legally they could, but because of regulations they cannot.
When it moves from collections to foreclosure they’ll add fees and when it moves to a lawyer, they’ll add more fees. To avoid that, you need to work out a forbearance, where you will agree to pay them a certain amount each month until you’re current.
Two payments each month for three months will get you current, so you need to contact your lender, tell them your plan, get it in writing that they accept your repayment plan, and get current. You also need to do a written budget so you know you can meet this obligation.
Then set up your $1,000 emergency fund. After that, take care of the other debts.