Expert Mortgage Brokers | North Bay mortgage default
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North Bay mortgage default

Defaulting on Mortgage Payments

There are several reasons why a client may default or fall behind on their mortgage payments. More often than not these are reasons or circumstances that were unexpected or unavoidable. Various reasons as to why this happens will be discussed later.

What Happens When You Fall Behind

When you default in payment the first course of action by the lender is normally to notify you via a formal letter of your default in payment and asking you to contact them as soon as you can. The lender usually wants to avoid foreclosure or power of sale as much as possible because it is bad business; it is time-consuming, expensive, and an inconvenience. Besides, the lender are not in the business of taking peoples’ huses. It is in their interest to make sure that the loan is performing.

If a home owner does not respond then usually a second notice is issued. These notices tell the home owner that a continued default in payment may result in power of sale action being initiated.

Reasons Why People Default in Mortgage Payments

  • Divorce

Divorce is cause for falling behind on mortgage payments. This can happen when there was a joint effort by both spouses to service mortgage payments. After a divorce, only one of the spouses become the sole bearer of the mortgage burden. This is bound to put a financial strain on them causing them to default on payments.

  • Unexpected Bills

Unexpected bills such as heavy medical bills can put a financial strain on a person. When a family member suddenly falls ill or becomes a victim to an accident, their wellbeing becomes a priority, and thus mortgage payments tend to take a back seat. North Bay mortgage default have found that this is a major contributing factor to defaulting on mortgage payments.

  • Loss of Job

Perhaps the most common reason why people fall behind on payments of their mortgage and fall into arrears is job loss. When someone loses their job they lose their primary source of income, part of which they were using to service the mortgage loan. Loss of job, can really inconvenience a person, and before they get back on their feet, they may find that they have defaulted on their mortgage payments.

What to Do If You’re Falling Behind on Mortgage Payments

It is important for North Bay Mortgage default residents consider these tips to help them get back on track with their mortgage payments.

    1. Contact Your Mortgage Loan Provider

Contact your lender as soon as possible and explain your current situation. Let them know that you are ready and willing to get back on track. What most people do not know is that many lender will work with you and provide you with several options on how to do this. Some of these options include a repayment plan or a rerefinance.

  1. Acquire Services of an Expert

Say you cannot manage to keep up the payments anymore, it is important that you act very fast by contacting experts in such matters, and they will advise you accordingly.  Certain options will be presented to you depending on your situation. Some of these may include Refinancing, Selling the home, and Mortgage modifications.