What to Do if You Can’t Make Your Mortgage Payments


So, you’ve hit a rough patch and can’t make your mortgage payments. Maybe it’s due to an unexpected job loss, medical emergency, or some other financial hiccup. Don’t panic! It’s a tough spot to be in, but it’s not the end of the world. There are steps you can take to get back on track and keep your home. Let’s dive into what you should do if you find yourself in this situation.

Assess Your Financial Situation

Take a Deep Breath and Evaluate

First things first, take a moment to breathe. Assess your current financial situation. Look at your income, expenses, and savings. Knowing exactly where you stand will help you figure out the best course of action.

List Your Expenses

Make a list of all your monthly expenses. Include everything from utility bills to groceries. This will give you a clear picture of where your money is going and where you might be able to cut back.

Prioritize Your Bills

Prioritize your bills to ensure you’re covering the essentials first. Mortgage payments should be at the top of your list, followed by utilities, groceries, and other necessary expenses. Non-essential expenses can be put on hold.

Contact Your Lender

Reach Out Early

As soon as you realize you might miss a payment, contact your lender. The sooner you let them know, the more options you’ll have. Lenders are more willing to work with you if you show initiative and honesty.

Explain Your Situation

Explain your situation in detail. Be honest about why you can’t make the payments and how long you expect the problem to last. This information will help your lender suggest the best solutions for your situation.

Explore Loan Modification Options

What is a Loan Modification?

A loan modification is a change made to the terms of your existing mortgage. This could include extending the length of your loan, reducing your interest rate, or adding missed payments to the loan balance.

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Types of Loan Modifications

There are various types of loan modifications, including:

  • Interest Rate Reduction: Lowering your interest rate to make payments more affordable.
  • Extended Loan Term: Extending the length of your loan to reduce monthly payments.
  • Principal Forbearance: Temporarily reducing or suspending payments.

How to Apply for a Loan Modification

To apply for a loan modification, you’ll need to submit a request to your lender. This will usually require a hardship letter, proof of income, and a detailed budget. Be prepared to provide all necessary documentation to support your request.

Consider Refinancing Your Mortgage

What is Refinancing?

Refinancing involves replacing your current mortgage with a new one, usually with better terms. This can help lower your monthly payments, making them more manageable.

When to Refinance

Refinancing is a good option if you have decent credit and your home has appreciated in value. If interest rates have dropped since you took out your original mortgage, refinancing can save you money.

Steps to Refinance

  1. Check Your Credit Score: Ensure your credit score is in good shape.
  2. Shop Around for Lenders: Compare offers from multiple lenders.
  3. Submit an Application: Provide necessary documents such as income proof and a current mortgage statement.
  4. Close the Loan: Once approved, close the new loan and start making payments under the new terms.

Explore Government Assistance Programs

Making Home Affordable (MHA) Program

The Making Home Affordable program offers various options to help struggling homeowners. These include loan modifications, refinancing, and other assistance to reduce mortgage payments.

FHA and VA Loan Programs

If you have an FHA or VA loan, there are specific programs designed to help you. The FHA’s Home Affordable Modification Program (HAMP) and the VA’s Home Loan Modification program can offer relief.

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Consider Temporary Forbearance

What is Forbearance?

Forbearance is an agreement with your lender to temporarily reduce or suspend your mortgage payments. This is usually short-term and meant to help you get back on your feet.

How to Apply for Forbearance

Contact your lender and explain your situation. Provide any necessary documentation and be clear about how long you expect to need assistance. Be aware that you’ll have to make up the missed payments later.

Sell Your Home

When to Consider Selling

If you’ve tried other options and still can’t make your mortgage payments, selling your home might be the best choice. This can prevent foreclosure and allow you to pay off your mortgage.

Selling Strategies

  • Short Sale: Selling your home for less than the mortgage balance, with the lender’s approval.
  • Traditional Sale: Selling your home at market value and paying off the mortgage with the proceeds.

Working with a Real Estate Agent

A real estate agent can help you navigate the selling process, ensuring you get the best possible price for your home.

Rent Out Your Home

Becoming a Landlord

If you can’t afford your mortgage payments but don’t want to sell, consider renting out your home. This can generate income to cover the mortgage.

Finding Tenants

Advertise your home for rent and screen potential tenants carefully. Make sure you comply with local landlord-tenant laws.

Seek Legal Advice

Consulting with a Lawyer

If you’re facing foreclosure or need help understanding your options, consult with a real estate attorney. They can provide guidance and help protect your rights.

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Legal Resources

Look for local legal aid organizations that offer free or low-cost assistance to homeowners in distress.

Avoid Mortgage Relief Scams

Common Scams

Be wary of companies promising quick fixes for a fee. Common scams include:

  • Upfront Fees: Asking for payment before providing help.
  • Guaranteeing Results: Promising a loan modification or foreclosure prevention.
  • Fake Government Programs: Pretending to be affiliated with government assistance programs.

Protecting Yourself

Research any company offering mortgage relief services. Check reviews and ensure they are legitimate. Never pay for assistance before receiving help.

The Importance of Communication

Stay in Touch with Your Lender

Maintain open communication with your lender throughout the process. Keeping them informed shows you’re proactive and committed to resolving the issue.

Ask for Help

Don’t be afraid to ask for help from friends, family, or community organizations. Sometimes, a little support can make a big difference.

Create a Financial Plan


Create a budget to manage your finances better. This will help you stay on top of your expenses and avoid falling behind on payments again.

Saving for Emergencies

Build an emergency fund to cover unexpected expenses in the future. This will give you a cushion to fall back on if you face financial difficulties again.


Facing the inability to make your mortgage payments is stressful, but it’s not an insurmountable challenge. By taking proactive steps, communicating with your lender, exploring all available options, and seeking professional advice, you can find a way to manage the situation. Remember, the key is to act quickly and not ignore the problem. With the right approach, you can navigate this tough time and keep your home.

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