The recent financial crisis has made it difficult for most people to make ends meet. It has made a tremendous impact on the way we live today. More and more people around the world are facing poverty and hunger everyday. The unemployment rate is at a record high. Major companies are even filing for bankruptcy. The mortgage rates have been rising and many homeowners are just unable to pay. This pattern may continue and the overdue amounts become called arrears. The arrears are added to the main amount of a mortgage, and soon they spiral until the amount becomes too big to pay. Don't let mortgage arrears increase, because you know what will happen next.
To get back on track, you have to come up with an organized plan. Have you been barraged by demand letters or calls regarding your mortgage payments? You can start by talking to your lender. Whether it is your bank or private mortgage companies, they deserve to know the truth. Lenders also don't want a foreclosure to happen because it is expensive. The legal battle will also be long and cumbersome. First, your mortgage agent has to know your financial situation so that he can get the full picture. This assures him that you are willing to pay for the loan but unable to because of money constraints. The lender may issue a repayment holiday to grant the homeowner a time period to get back on their feet. They can also sign an agreement to pay for the amount within 1-2 years. They can also cut the amount by just limiting payments to the interest. You might want to consult with your mortgage advisor for other options to resolve your mortgage arrears . Both parties should come to an agreement on how the fees will be paid.
Now that both parties are in agreement, you might want to request a forbearance agreement. This will be a promissory note to the bank or the mortgage company that you will continue paying the amount based on a different set of conditions until the debt is paid off. However, if it's not possible, then you might want to ask for remortgage offers instead. The lenders can offer to change the mortgage plan to lessen your monthly fees. This will clear out the mortgage arrears, although it would take longer to pay off the mortgage.
The banks can also issue a new cash back mortgage for you to pay off the arrears using a lump sum. The rest can be paid in monthly installments over a specific period of time. You can also downgrade your mortgage insurance with a cheaper policy so that it will be easier to manage in the future. You can also seek out guaranteed loans to help you pay it off.
Another helpful tip in clearing out arrears is to get help from credit counselors. They can help you figure out how you can get out of debt. You can simply fill in the form found on their website, and they will call you back to start the session.