Blog post default


Harris-Courage & Grady, PLLC July 15, 2015

What are my options if I’m behind in my mortgage?

There are several potential options if you are behind in your mortgage. Having worked as a creditor attorney helping mortgage companies, I know how the mortgage companies work and how they think.

Although you might think that the mortgage company would be willing to work out a deal rather than foreclose, think again.

In fact, the mortgage company you are dealing with has a bigger incentive to foreclose than to choose any other option.

Each option has benefits and drawbacks and it is important to understand what you want to accomplish and your ability to accomplish it.

Some options include:

  • Chapter 13 Bankruptcy: Start making the regular payment and cure the arrears over 5 years. This is an option which we can force the mortgage company to accept and is probably your best and least expensive option.

  • Pay the Mortgage Current: Usually clients don’t have the resources to do this, otherwise they probably would not be facing foreclosure. Read our free book What is the Best Way to Get Out of Debt? before choosing this option.

  • Reverse Mortgage: This option is only available to homeowners aged 62 and above. In addition, you must have significant equity in your home. We can recommend several reputable reverse mortgage brokers who can help you determine if this is an available option.

  • Negotiate with the Mortgage Company: Our experience is that the process is extremely difficult and does not work unless you hire an attorney to help you. Honestly, the end result will usually be something we would not recommend.

  • Fight the Mortgage Company: Our experience is that the mortgage company will add on so many attorney fees that it will be impossible to later negotiate a reasonable outcome. They will hire NYC lawyers who will ask for lots and lots of documents and spend lots of money fighting in every way possible.

  • Refinance Your Home: If your home is in foreclosure, your credit is ruined and you will not be able to refinance your home through a reputable lender.

  • Sell Your Home: Your mortgage company will like this option, but you lose your home and will not be able to get another mortgage for a while. In addition, the market may not support a price for your home that allows you to do this option.

  • Short Sale: You must get the mortgage company’s permission to do a short sale where you sell the house for as much as you can, but at a price which does not pay the mortgage company in full and thus leaves the mortgage company “short.”

  • Deed In Lieu: You transfer over your home by a deed to the mortgage company “in lieu” of the mortgage company foreclosing on the property. The mortgage company must approve this and many times they will not agree to accept the deed.

  • Foreclosure: This will be the option the mortgage company will want to pursue. In a few cases, this may even be beneficial to the home owner.

Call us today so we can help you decide which is your best option and help you implement it.