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If you’re struggling to afford your mortgage, it’s important to communicate with your lender right away. Lenders are typically willing to work with borrowers to keep mortgages affordable. Here are some of the options you may be offered if you’re behind on payments — or worried you soon will be.

How to catch up on mortgage payments

Whether you’ve fallen behind on mortgage payments due to a recent job loss, unforeseen expenses or another type of financial hardship, here are six options to explore:

1. Forbearance

Mortgage forbearance suspends or reduces your payments for a set period. During this time, the record reflects that you’re current on your mortgage.

Once the forbearance period ends, you’ll repay the paused payments in a lump sum or through installments. If it’s the latter, you might have these installments added to your monthly mortgage payment or tacked onto the end of your loan term, extending it by up to a year.

Forbearance is best for borrowers with a temporary financial setback, such as job loss.

2. Loan modification

A loan modification permanently changes the interest rate, term or both on your mortgage. This option is best for borrowers who know they won’t be able to afford their current monthly payment due to a major financial hardship, such as:

• Long-term disability or illness that prevents you from working
• Death of a family member who had been earning an income for the household
• Divorce
• Significant spikes in property taxes or other housing costs
• Natural disaster

To qualify for a loan modification, borrowers must provide proof of financial hardship, such as medical bills. You must also typically provide documentation of your income and expenses, such as pay stubs, tax returns or bank statements.

If your mortgage is backed by Fannie Mae or Freddie Mac, you may be eligible for the Flex Modification program.

Though not common, you could also modify your loan through a principal reduction — if your mortgage servicer allows it. This cuts down your outstanding balance, which would lower your monthly payments.

3. Repayment plan

While not the easiest route, you might be able to set up a simple repayment plan with your servicer, especially if your difficulty was brief, and you’ve gotten back on your feet financially.

However, you’ll have to convince your servicer that your financial situation has improved and that you can handle the additional cost each month.

A housing counselor can help you communicate with your servicer and understand your options. You can find a counselor in your area using the U.S. Department of Housing and Urban Development’s online lookup tool, or by calling 800-569-4287.

4. Refinance

A mortgage refinance might be for you if you’re ready to restart your payments, you plan to stay in your home for a while and prevailing interest rates have come down since you got your loan.

That last part is especially important: If rates are higher now, it might not make sense to refinance to a new loan. You’ll also need to pay closing costs.

5. Lower recurring expenses

If you can handle your principal and interest payment, but your homeowners insurance premiums, property taxes or other expenses have become unmanageable, it’s time to revisit those costs. Here are some solutions to explore:

• Homeowners insurance: Shop around for comparable coverage at a better price. You can compare insurance quotes on Bankrate.
• Property taxes: You might be eligible for a property tax abatement, especially if you’re a senior. Visit your local tax authority’s website to learn more.
• HOA dues: If your home is in a homeowners association, and you’ve fallen behind on HOA fees, contact the HOA as soon as possible. You might be able to work out a payment plan.
• Utility bills: Check whether your electric, water and other utility providers offer hardship assistance, including lower monthly payments. Depending on your state, household size and income, you might also qualify for help through the federal Low Income Home Energy Assistance Program.

6. Assistance funds

Find out if you’re eligible for any assistance programs through your state, county, city or relevant professional organizations. The Homeowner Assistance Fund (HAF), for example, was established to help homeowners who fell behind on mortgage payments or other housing expenses due to the pandemic. While the program is now closed in many parts of the U.S., it’s still open in the following states:

• Colorado
• Georgia
• Idaho
• Montana
• Nevada
• New Jersey
• North Dakota
• South Dakota
• U.S. Virgin Islands

When to sell your home

If you’ve fallen behind on mortgage payments and aren’t able to catch up, even with assistance from your lender, you’ll want to consider selling your home. Ideally, you’ll do this before your home goes into foreclosure to limit the impact on your credit.

Your options include:

• Traditional home sale: If your home is likely to sell for more than your mortgage balance, your best bet will be to go for a traditional home sale. You can then repay your lender and focus on finding affordable housing.
• Short sale: In a short sale, you receive permission from your lender to sell the property for less than your mortgage balance. The lender takes the proceeds and ideally forgives the difference — though this isn’t always the case.
• Deed in lieu of foreclosure: If your lender offers it, a deed in lieu of foreclosure gives your lender the deed to your home in exchange for releasing you from your mortgage debt.

FAQ

• What if I’m behind on mortgage payments and lost my job?
  

  If you lost your job and need help keeping up with mortgage payments, contact your mortgage servicer right away. Depending on your circumstances, you could be eligible for temporary forbearance or a loan modification if the job loss is permanent.

• What happens if you can’t catch up with mortgage payments?
  

  If you can’t catch up on mortgage payments, you could eventually lose your home to foreclosure. This process typically starts after 120 days of non-payment, but most mortgage servicers contact you sooner. Again, be proactive and reach out to your servicer to work out a relief plan.

• What if I can’t pay my mortgage due to natural disaster?
  

  In areas impacted by natural disaster, mortgage servicers almost always offer forbearance to affected borrowers, and some even extend it automatically. As soon as it’s safe to do so, contact your servicer to learn next steps. Don’t stop making payments until you confirm your loan is in forbearance.