What Will Lenders Do If I Lose My Job?
Question: I’ve been laid off and must now go on unemployment. The prospects for a job with equal pay do not look good and I have more bills than a flock of mallards. What do I do about my mortgage?
Answer: Plainly you’re in for a rough time, financially. You must pay your mortgage. Alternatively, lenders do not want to foreclose — it costs them money and raises questions with regulators.
This is the moment when you need to ask some terribly tough questions: Should you sell the house? Rent the basement? Can you trade a new car for a safe, older one? Accept work, any work, to make good on your debts? Dip into savings and retirement funds — but beware of potential tax penalties.
If you see that mortgage payments are going to be late or not made at all, then you or your attorney or a community housing organization must contact the lender — the sooner the better. The burden is on you. You must contact your lender so they understand what\’s going on and how you expect to resolve the problem. Some may be able to help in certain circumstances. Example: In a natural disaster area lenders routinely suspend foreclosure actions.
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Syndicated originally by Content That Works and posted with permission.
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Comment by s2kreno on 4 November 2008:
Absolutely correct that contacting the lender is critical. In terms of salvaging your credit, your mortgage is THE most important bill you have. Pay it even if it’s the only bill you pay. Consumer Credit Counseling can help you get a budget together and get your other creditors to cut you some slack as well. If you don’t have a lot of assets to lose and you have tons of unsecured debt, bankruptcy may be a way out. If your income is never again going to be ebough to pay bills you already have, a fresh start may be the best way out. But try counseling first.