We all know that life happens. You might lose your job, or you have some emergency debt like medical bills that you need to pay to get a family member healthy. So, the one thing that you skip on, is your home loan payments. Yes, it isn’t recommended, but it does happen that people can’t afford the payments anymore. Then what?
Before you start selling your home, because you can afford your home loan anymore, you need to consider these three options. This might be a way out for you to get some relief on your premiums, and for you to keep your home.
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Apply for a forbearance plan
This is your first option when you can’t afford your home loan for a short period. Depending on the reason why you can afford the home loan premiums, you can get a deal with the lender. They can put your premiums on hold for a couple of months until you are able to pay again. Or, they can reduce your premiums and you just pay the loan for longer. The best option is to talk to the lender as soon as possible.
Ask for a loan modification
Another option is to ask the lender for a loan modification. This is possible and many lenders will consider this option instead of not getting a premium at all. However, you will need to have a good reason why you can’t afford the normal premiums anymore.
Sometimes this is because you were demoted, or you lost your job and are searching for a new one. If this is the case, the sooner you are applying for a loan modification, the better.
Refinance your home loan if possible
This is your third option. If you just have too much debt and you can’t get to all your premiums, this might be an option. Refinancing your home loan. Making sure that you are going to pay less for your home loan. And, use the money you got from the refinance to pay off your other debt. For many, this is a great option, but you will need to qualify for a refinance loan first.
The great thing about this option is that you can go to another lender. You don’t need to use the same lender as your existing home loan.
When you can’t afford your home loan anymore, it isn’t the end of the world. There are some options that you can consider, especially if this is just a temporary problem. The key to not affording the premiums anymore is to make an appointment with the lender and to discuss the problem with him. The sooner you talk to him, the better. By just leaving the premiums, you will get into trouble and might even lose your home.