What is a Repayment Plan?

A Repayment Plan spreads out your past due amount, in addition to your current mortgage payments, over a number of months in order to bring your mortgage up to date.

A Repayment Plan might be an option if:

• – You are encountering a short-term hardship
• – You are a few (or a number of months) behind on your mortgage payments
• – You are not qualified or don’t want to refinance
• – You can now afford your monthly mortgage payment

What are the benefits of a Repayment Plan?

• – It enables you to catch up on your past due payments over an extended period of time
• – It brings your mortgage up to date and resolves your delinquency
• – It’s less damaging to your credit score than a foreclosure
• – It can allow you to stay in your home and avoid foreclosure

How does a Repayment Plan work?

• If you are eligible for a Repayment Plan, usually your past-due amount will be spread out over a specific time frame (ex. 3, 6, 9 months) and added on to your existing mortgage payments. Other repayment terms may also be available during the repayment time period. Find out details on your specific options from your mortgage company.
• Your mortgage company might have you sign an agreement that will outline how you are going to repay your past-due amount, such as the specific terms and the length of the repayment period.

What Next?

Step 1

Collect your financial information; be sure to have all your basic financial and loan information on hand when you call your mortgage company. You will need to have:

• – Your mortgage statements, as well as any information on a second mortgage, if you have one;
• – Your other monthly debt payments (ex. credit card payments, car or student loans);
• – Your income details (income tax returns and paystubs).

Step 2

Explain your current situation. Be prepared to describe your current hardship and explain why you are having trouble bringing your loan up to date, and whether this is a short-term or long-term issue. Your mortgage company will need to have a clear understanding of the reasons why you are having difficulty in order to find the right solution for you.

Step 3

Contact a mortgage company and tell them that you are interested in a Repayment Plan and you want to see if you are eligible.