Questions And Answers About Foreclosures (Foreclosure FAQs)

What happens when I miss my mortgage payments?

If you miss your mortgage payments a foreclosure on your property can take place. This means your lender could legally repossess (take over) your home. When this occurs, you will have to move out of your house. If your property is worth less than the total amount you owe on your mortgage loan, a deficiency judgment might be pursued, which means that you would not only lose your home, you also would owe HUD money. 

Both foreclosures and deficiency judgments can seriously have an effect on your ability for credit qualification in the future. So it is better if you avoid foreclosures if at all costs.  

What should I do when the problem comes? 

Do not ignore letters from your lender. If you are having trouble making your mortgage payments, call or write to your lender's loss mitigation department immediately. Inform them of your situation. Be prepared to give them your financial information, like your monthly income and expenses. Without this information, they may not be able to assist you.  

Stay in your home for the time being. You may not qualify for help if you abandon your property.  

Contact a HUD approved foreclosure housing counseling agency. Call toll free 1-800-569-4287 or TDD (800) 877-8339 for the housing counseling agency nearest you. These agencies are valuable resources. They can provide information on services and programs offered by government agencies and private and community organizations that might be capable of helping you. The housing counseling agency may also give you credit counseling. These services are generally free of charge.  

Who is my lender? How can I contact them? 

Look at your monthly mortgage coupons or billing statements for the lender's name and contact information. 

I don't remember what sort of mortgage I have. How could I find this information? 

Look on the original mortgage documents or you can call your mortgage lender. 

Do I have to keep living in my house to qualify for help? 

Typically yes, but call your lender to talk about your precise circumstances and get recommendation on options that may be available to you. 

My employer has already announced layoffs in the approaching month. What could I do now? 

You've started learning about available alternatives here. Now, try to determine if a layoff will make it hard for you and your family to make your mortgage payments. If so, consider other resources you have to pay your mortgage. Examine your spending habits and find ways to decrease spending. If you have several other debts, consider contacting a non-profit consumer credit counseling agency. Take advantage of any help your employer offers. If you still believe you will have trouble making your mortgage payments, contact your lender immediately. 

What are the key points to remember? 

Don't lose your home and harm your credit history  

Call or write your mortgage lender right away and be honest about your financial situation 

Stay in your home to ensure you qualify for assistance  

Organize an appointment with a HUD-approved housing counselor to discover your alternatives toll free at (800) 569-4287 or TDD (800) 877-8339  

Cooperate with the counselor or lender attempting to help you  

Explore every option to keep your home  

Beware of scams  

Never sign anything you don't understand. And remember that signing over the deed to someone else does not essentially relieve you of your loan obligation  

Act now. Delaying will not help. If you do nothing, you will lose your home and your good credit rating!  

What precautions could I take? 

These precautions could help you avoid being "taken" by a scam artist: 

Don't sign any papers you don't fully understand.  

Be sure to get all "promises" in writing.  

Be careful with any sales contract that assumes the loan where you are not formally released from liability (responsibility) for your mortgage debt.  

Check with a lawyer or your mortgage company before entering into any deal consisting of your home.  

If you're selling the house yourself to stop foreclosure from happening, check to learn if there are any complaints against the prospective buyer. You can contact your state's Attorney General, the State Real Estate Commission, or the local District Attorney's Consumer Fraud Unit for this type of information. 

Will I be responsible for any out-of-pocket expenses if I am approved for a workout option? 

You might have to pay expenses such as recording fees for a loan adjustment. Since every case is different, contact your lender for additional information. However, if a lender has no contact with you and needs to start foreclosure, you may have to pay really high legal fees. To avoid this, call your lender the moment you understand you may have trouble. 

Mortgage lenders 

The mortgage lenders listed below have voluntarily joined the federal government to assist homeowners who are worried about the future or have suffered due to recent changes in the economy. If your lender is listed here, you could help protect your home by contacting them right away! 

Bank of America 

Chase Home Finance 

CitiMortgage 

HSBC Mortgage Corporation 

Irwin Mortgage Corporation 

James B. Nutter & Company 

Midland Mortgage 

Mortgage Service 

National City Mortgage 

Nationwide Advantage Mortgage 

Principal Residential Mortgage, Inc. 

Sun Trust Mortgage 

Wells Fargo Mortgage 

Wendover Financial Services Corporation