Anyone can have difficulty making a mortgage payment. Loss of employment, medical problems or unexpected financial losses can occur which put additional stress on household expenses. The VA Guaranteed Home Loan Program that provides home loans for veterans can offer financial counseling to holders of VA mortgage loans to make it easier to make their payments. The program recommends a number of strategies for homeowners who are delinquent on their mortgage payments.
Discuss A Repayment Plan With Your Bank
If you are having trouble making a mortgage payment, the first action you should take is to contact your lending institution to alert them to your difficulty. A frank and honest discussion of the problem will allow you to work with your bank to find an appropriate repayment plan to catch up on your mortgage payments. Most banks are willing to work with their customers to ensure continued payment on their loans. Once you have established a repayment, stick to it and make every adjustment necessary to avoid having problems in the future.
Your bank may be willing to allow you to re-structure your loan, rolling in the missed payment into the final balance. You will have to assure the bank that the financial problem has been resolved and that you will be able to make future payments on your loan without difficulty.
Additional Time For A Private Sale
If your financial problems are likely to continue for some time, it may be beneficial to sell your home. This measure will prevent a foreclosure on your record and will allow you to keep the amount of equity you have accumulated in your home. Talk to your bank about allowing you additional time to accomplish a private sale without filing a foreclosure.
Do A Short Sale
Many banks will allow homeowners to do a short sale instead of filing a foreclosure on the property. A short sale sells the home for less than the amount that is required to pay off the mortgage amount.
A Deed-in-Lieu of Foreclosure Agreement
A deed-in-lieu of foreclosure allows the homeowner to deed the property to the mortgage servicer instead of going through the entire legal foreclosure process. This measure can prevent having a foreclosure on your financial record.
The VA Interest Rate Reduction Refinancing Loan
The VA Guaranteed Home Loan Program understands that economic conditions can sometimes make making mortgage payments difficult. They have implemented a special streamlined refinancing program that can lower interest rates and lower monthly payments. Because the VA eligibility of the homeowner has already been determined, further credit checks are not required. In general, the loan must not be in delinquency to receive approval for an IRRRL. However, if a mortgage is past due more than 30 days, a special “prior approval” is required. In this case, the lender may require a new credit report.
Contact the VA Loan Delinquency Assistance Counselors
The VA loan program provides Delinquency Assistance counselors that can help homeowners understand their options. They can offer suggestions on cutting expenses to better manage payments, give advice on making arrangements with the lending institution and provide information on refinance programs through the VA home loan program.