
When you fall behind on your mortgage payments on your Rhode Island home, it can feel like you’re drowning in debt… and you may feel that you have no options for preventing your lender from foreclosing on your home.
Even if you’re currently able to make your monthly payment, catching up on any past-due balances can be overwhelming. The current state of the national economy has caused many Rhode Island homeowners to cut their spending on certain items in order to maintain payments on their mortgage.
Firstly, it is important for you to know that you have options which can help you to avoid foreclosure in Rhode Island and maybe even keep your house, regardless of how far behind on payments you may be! Personally, I can think of several instances where homeowners in Rhode Island have lost their properties unnecessarily to foreclosure without exercising all the options they had available to them. In several cases, you may find it beneficial to negotiate with your lender or field cash-offers from local investors before relinquishing your property.
Help, I’m Behind on My Mortgage Payments in Rhode Island! 5 Things You Can Do To Help Your Situation
1. Bankruptcy:
This is typically a ‘last resort’ option due to the impact it would have on your personal credit score, however, if you’re being crushed by debt and forced to make difficult decisions, bankruptcy can be a good way to negotiate with all of your creditors at once. It’s a lot of work, and it won’t necessarily help you avoid paying the remainder of your mortgage. Different lenders will treat your circumstances in unique ways and most likely your debt will be consolidated and restructured into a plan which could take you several years to payoff. Filing for bankruptcy will also negatively effect your ability to secure any type of personal loan or mortgage for several years to come – keep this in mind when weighing this as an option to avoid foreclosure on your Rhode Island property.
2. Reaffirm:
This can be a good card to play, but it may come with some unseen penalties. Basically, reaffirming the loan is an additional commitment to pay. In some states where it’s allowed, an affirmation can create additional liabilities if your property is auctioned. Unlike bankruptcy, reaffirming the debt on a property means you agree to pay the remainder of your debt, while continuing to maintain ownership of the property.
3. Making Home Affordable (MHA):
If your mortgage qualifies, you might be able to participate in the federal MHA program. Any loans backed by Fannie Mae or Freddie Mac are eligible for the MHA program, and several lenders are able to work with homeowners to go through the steps necessary to apply for Making Home Affordable.
With MHA, your payments and/or interest rates will be restructured and could also be lowered – even the principal balance (if your home is worth less than you owe). Furthermore, if you’re unemployed, you might be able to get your payments temporarily suspended or reduced.
Please be aware that MHA is a government funded program, so be prepared to manage a great deal of paperwork and communication with the program officials as well as the lender.
4. Negotiate with your bank:
Many lenders routinely offer some level of assistance for homeowners who are struggling to pay their mortgage in Rhode Island. This is another option which will require time and effort on your part, however, you might be able to reduce your interest rate or receive a temporary reduction in your monthly payment.
Most of the time, lenders will want to steer you to refinance your loan – however, by the time you’re a few payments behind, you probably don’t qualify for a reduction in interest rate anymore.
You will have to work really hard to negotiate with your bank. Usually, it takes several calls and the patience of a saint to get through the bureaucracy. Never, ever act rude as this will diminish your chances of a favorable refinance. Ask for help from everyone you speak with, but don’t sound desperate. Explain your situation, offer supporting documents, and reassure the bank that you want to live in your home for the long-term.
If you’re in need of a temporary fix and want to stay in your home, most banks can be forgiving. Sometimes they’ll even be willing to add a few months of payments back onto the primary balance of your loan. It’s all dollars and cents to them, so remind them that you need their help temporarily, but that it will payoff for them in the long run. If they have to sell your house at a foreclosure auction, they’ll take a huge loss, so this isn’t the best option for them either!
That sounds obvious, but for some reason, bankers seem to forget it when saying no to someone in need of help.
5. Borrow money from a private investor:
If you live in Rhode Island and you’re behind on your mortgage payments and need to sell your home quickly, Home Tree LLC can help! The owner – Matt is a Navy veteran with many years of experience in the real estate industry. His expertise and local market knowledge can bring ease of mind to your property struggles.
In certain circumstances, we may even be able to help you stay in your home. We may even be able to buy your property outright with all cash if you are interested in selling and becoming a renter. At Home Tree LLC we work with Rhode Island Home sellers all over the state with homes that are in all conditions, we buy as-is so you can walk away from your property without any effort on your part. I will make you a fair cash offer for your property taking into consideration any repair costs and associated risks that come with renovation a home.
Although Rhode Island is a small state, our real estate market is extremely diverse, at Home Tree LLC we work with homeowners all around the Ocean State to find solutions to foreclosure problems. We understand each homeowners’ situation may be different and we take into consideration all factors before making you a fair cash offer. You have no obligation and I would be happy to meet at your property and give you a free estimate of value if you so choose.
Put our expertise and local knowledge to the test, there is no obligation on your part and you have nothing to lose. We are more than happy to walk you through your options and point you in the right direction or even give you a fair cash offer for your Rhode Island Home! Call me – Matt Huff today to find out how I can help sell your home!