Loan Modification

• In many cases, those having trouble paying their mortgage can get help directly from their lender in the form of a loan modification. If the borrower is currently living in the home on which they need a modification; owes less than $729,750 on their first mortgage; received their mortgage before January 1, 2009; has a payment that is more than 31 percent of their gross income and can't afford the mortgage payment because of a financial hardship like a job loss or excessive medical bills, then the borrower may qualify for a modification. A lender needs the following information in order to determine if a borrower qualifies for the program: monthly gross income; most recent tax return, asset information, mortgage statements, information about second mortgages or lines of credit, account balances due on credit cards, student loans and car loans, and a completed Hardship Affidavit form describing the circumstances.
  
  

Government Assistance

• When a homeowner loses his job or has another financial hardship, it is possible to apply for assistance from the government. Applying for food stamps, for example, can save the homeowner enough money each month to be able to pay his mortgage payment. Your state government may also be able to help you pay child care costs, utility bills, heating costs, phone bills and other important expenses, allowing the homeowner to use the income saved from these expenses to pay for the mortgage.
  
  

Refinancing

• Those borrowers who are current in their mortgage, but were not able to refinance for a better rate because their home has decreased in value, may be able to refinance their loan under the Homeowner Affordability and Stability Plan. Fannie Mae and Freddie Mac will "allow the refinancing of mortgage loans that they hold in their portfolios or that they guarantee in their own mortgage-backed securities," according to the Federal Deposit Insurance Corporation (FDIC). Homeowners who wish to refinance need to contact their lenders and find out if they qualify for this program.
  
  

Lender Help

• A homeowner who is having trouble making payments or knows they will have trouble making payments in the future, should contact their lender directly. Getting ahead of the issue and being honest about it can be much more beneficial than hiding from the problem. In some cases a forbearance or modification can be made directly through the lender. Homeowners should let their lender know exactly what the problem is, whether it's temporary or permanent, how they intend to fix the problem and what they'd like to see happen. Homeowners should keep detailed notes about each interaction with their lender, including phone calls, with whom they spoke and the outcome of the call. Keeping the receipts and transactions of faxes or mail is also important. It is also important to keep deadlines and appointments, especially if trying to keep a home out of foreclosure.