For those people who are eagerly looking for mortgage debt elimination, it is essential that they should know a few things about the subject.
Mortgage debt elimination: 3 things to know
A lot of people all over the world are at present looking for ways for mortgage debt
elimination. Many of them are facing difficulties in making their minimum payments each month, and falling even deeper into a debt trap. It may be of great help to these people if they take the trouble of knowing a few essential things about mortgage debt and its elimination. Here are five of them.
Refinancing your mortgage
You should make an application only when you are ready. If you find that the mortgage rates at present are lower than what you have been paying, try to refinance the mortgage to enjoy the advantage of the reduced mortgage payment each month.
You should know that mortgage loans are usually secured by your house. Secured debts involve some asset, such as your house, for a mortgage. The point you must remember is that if you default on repaying your loan, lenders have the right to foreclose on your house. Unsecured debts, such as credit card debts, medical bills etc., are not linked with any asset.
Delay is dangerous
Never waste any time to contact your lender in case you lag behind on your mortgage payment. Otherwise, the possibility of foreclosure cannot be completely ruled out. Lenders will respect honesty on your part and will be ready to work with you if they are convinced that you are telling the truth.
You should also be aware that lenders may lower or keep in abeyance your payments for a short period; when you start making regular payments again, you are required to pay only a small extra amount on account of your past dues.
A few other lenders may be ready to modify the mortgage terms by extending the repayment period that lowers the amount of the monthly debt. You should inquire if you will have to pay extra fees because of these changes, and figure out how much they amount on a long-term basis.
Housing counseling agency
In the event of you and your lender failing to chalk out a plan, you may contact a housing counseling agency. These agencies mostly offer their counseling services to homeowners with FHA mortgages only. But some of them also offer mortgage debt counseling for free to any secured debtor who is facing difficulties in making mortgage payments. If your problems are because of excessive debt or your failure to pay off your debts, you may be recommended by a credit counseling company to enroll in a debt managements plan. You may seek the help of the local office of the Department of Housing and Urban Development to locate a legitimate housing counseling agency near you.