Financial hardship can happen to anyone. No one is immune to possible layoffs, economic disturbances, injury, and illness. While there is no shame in a financial reversal, it can be a heart-wrenching situation. The most important thing is to create a strategy for turning your finances around and just move forward. If you are falling behind on your mortgage payments, you have several viable options to explore.
Try to Get Forbearance
If you think your financial situation is simply a short-term setback, your best option might be to apply for forbearance with your lender. Forbearance is when your mortgage company offers you some time to reverse your financial situation and get back on your feet before resuming payments. Forbearance usually lasts 3-6 months, although you can try to have it extended to a year.
Just remember, the money owed during this time is not forgiven–you will still have to pay it. Some lenders require it to be paid in a lump sum at the end of your forbearance period, so don’t choose this option unless you are sure you will be able to come up with the money.
Refinance Your Loan
Another option is to refinance your loan. If your payments are high because of a high-interest rate or because you have a short-term loan, you should be able to reduce your monthly payments by refinancing. A lower interest rate could save you thousands of dollars in the end, as well as give you a monthly reduction in your payments. Additionally, switching your loan period from a 15-year to a 30-year loan will significantly reduce your monthly bill.
Sell Your Home for Fast Cash
If your financial reversal looks to be long-term, you are worried about paying back forbearance payments, or you can’t refinance your loan, you might be best off selling your home quickly and finding something more affordable. The fastest way to sell your home is to sell it for fast cash to a home buying company. With this option, you can get out from under the financial burden of your mortgage payments, insurance fees, tax payments, HOA fees, and utility bills in as little as 7 days!
While no one ever wants to endure financial hardship, it helps to know that you do have choices. Try not to panic. Instead, focus your efforts on cutting costs and seeking out better employment. You have the power to turn things around!
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