Every day thousands of people like you have trouble making the next mortgage payment. Though things may seem hopeless, help is available. However, you need to take the first step! If you ignore the problem, you may lose your home to foreclosure, possibly affecting your ability for future credit needs.
You can find a contact number on your mortgage statement. When you call, be prepared to explain: 1) Why you are unable to make your payment, 2) Whether the problem is temporary or permanent, and 3) Details about your income, expenses, and other assets like cash in the bank.
If you are uncomfortable talking to your lender, contact Genesis Housing Services @ Far South CDC, which is a HUD-approved housing counseling agency that can help you understand your options. We can also work with your lender to detail a plan going forward. These services are FREE OF CHARGE!
Open all of the mail you receive from your lender. It contains valuable information about repayment options. Later mail may have important legal notices. Failing to read the mail will not prevent a foreclosure action. If you have trouble understanding the information provided by your lender, contact us.
Federal Housing Administration (FHA) provides, as part of its insurance contract with lenders, loss mitigation actions the lender must evaluate and take, when appropriate, to reduce financial losses on loans in default. Your lender needs information from you to fully evaluate these options. If you want to keep your home, talk to your lender about available workout options from home retention. While the options listed here are for borrowers with FHA-insured loans, most lenders offer similar workout plans designed to help you keep your home.
Special Forbearance: Your lender may provide for a temporary reduction or suspension of your payments to allow you time to overcome the problem that reduced your income. Then you may be offered a payment plan so you can pay back the missed payments a little at a time until you are caught up. An extended forbearance period may be provided to unemployed borrowers who are actively seeking employment.
Mortgage Modification: A modification is a permanent change to your loan through which the overdue payments may be added to your loan balance, the interest rate may be changed or the number of years you have to pay off the loan may be extended.
Partial Claim: In a Partial Claim, a borrower received a second loan in an amount necessary to bring the delinquent loan current. The loan is interest free and does not need to be repaid until you pay off your first mortgage or sell your house. This option is only available to borrowers with FHA-insured loans. However, if you have a conventional loan, ask your lender if they offer an "advance claim".
FHA-Home Affordable Modification Program (FHA-HAMP): This opiton combines an enhanced partial claim with a loan modification. Under the FHA-HAMP, the partial claim loan will not only include any amounts necessary to bring your mortgage current but may also include an amount to reduce your existing loan balance by up to 30%. The reduced loan balance will then be modified to lower your monthly mortgage payment to an affordable level. As described above, the partial claim loan is interest free, but must be repaid when you pay off your first mortgage or sell your house.
To qualify for any of these options, you will need to provide your lender with current information about your income and expenses. Also, your lender may require that you agree to a payment plan for three or more months to demonstrate your commitment before you are approved for a modification or partial claim.
If your income or expenses have changed so much that you are not able to continue paying the mortgage even under a workout plan offered by your lender, you should consider the options below:
Pre-Foreclosure Sale: With your lender's permission, you can offer your house for sale and sell it at fair market value even if the amount you receive from the sale is less than the amount you owe. If you meet certain conditions, you may be eligible to receive relocation expenses.
Deed-in-Lieu of Foreclosure: As a last resort, you may be able to voluntarily give your property back to your lender. If you leave the property clean and undamaged, you may be eligible to receive relocation expenses.
There could be income tax consequences to any plan that reduces the amount of debt you owe. But check with a tax or legal advisor before accepting these workout options.
Please note: Genesis Housing Services @ Far South CDC does not provide you tax or legal advice. We will refer you to partners with the expertise.
If you can't find the answer to your question, complete the above pre-assessment!
No. GHS does not provide grants. However, we do connect you with programs that do offer grants. Please see IHDA's Homeowner's Assistance Fund Program.
It can take approximately 12-15 months from the first missed payment for the entire foreclosure process to be completed in Illinois.
No. You can receive free counseling services in other areas such as rental assistance, homebuyer assistance, or financial coaching. You must currently own and live in the property to receive foreclosure assistance.
Yes. GHS is able to assist those who own and live in investment property.
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