Mortgage Payment Priority
If your credit score is important to you, you will make sure that your mortgage payment is on time each month. American Home Equity Loans researches and evaluates the power of mortgage payment history. One of the worst things you can do for your credit score is to have 30, 60 or 90 day date payments being reported from your mortgage company.
According to the U.S. Department of Housing and Urban Development (HUD), one of the most vital things you can do is take swift action if you find an error being reported on your credit scores. Then, evaluate how much money is coming in and how much you owe for your various bills.
Eliminate unnecessary spending.
Contact your mortgage lender as soon as possible. Don't let embarrassment stop you from notifying your lender about your financial situation. HUD says most lenders want to help borrowers keep their homes. Foreclosure is expensive for all parties involved. Lenders have workout options to help you keep your home. But lenders are most accommodating when you are just one or two payments behind. The farther behind you get, the fewer options exist. Most home financing lenders will help you explore your options.
Don't ignore letters that your mortgage lender sends you. If you haven't contacted your lender and you start receiving letters when you're behind in making your payments, you need to respond when they contact you. If they don't hear from you, they will take legal action.
Talk to a home loan or housing counselor. If you don't want to contact your lender right away, call a HUD-approved housing counselor. He or she will help you assess your financial situation, review your options, and - most importantly - help you negotiate with your lender. Counselors are familiar with the work-out arrangements for various lenders.
Prioritize paying off your debts. Under new budget constraints, you'll need to focus on food, utilities, and shelter. If you don't pay your debts, chances are your credit will be negatively impacted. Any money you have after paying for food and utilities should go toward your mortgage payment. In addition to contacting a housing counselor, you may want to contact a non-profit consumer credit counseling agency. A credit counselor can often reduce your monthly bills by negotiating lowered payments or long-term payment plans with your creditors. Most of these agencies provide their services free of charge. Be leery of an agency that requires a large fee or donation.
Maintain your credit scores as high as possible. Resist the urge to pay with plastic - you don't want to fall behind on additional debts and ultimately mar your credit report. This is especially important if you're trying to find a new job. Many employers check candidates' credit reports. It will also affect you if and when you buy or rent again.
Explore loan rehabilitation or refinance solutions. If at all possible, stay on top of your mortgage payments. If you are unable to do so, contact your lender to help you find a program.
Read more great articles at the Realty Times online.