I owe $17K in mortgage payments and face daily panic attacks—can I get a loan modification?

Being behind on your mortgage payments can be really frightening because there’s a risk the bank could foreclose on your house. This is the situation that one Reddit user is facing right now. 

The Redditor explained that his wife quit her job to care for her father, who passed away. Then, his father died, and Hurricane Helene occurred. The couple ended up relying on credit cards and fell six months behind on mortgage payments, so he now has $17K of unpaid payments.

He’s resumed paying on his loan now and has made regular payments every month for the past three months. Since his wife is working again, the couple can keep making those payments. What they cannot do, though, is come up with the $17K all at once to pay the bank. They also took a huge hit to their credit scores, so he doesn’t think he can borrow the $17K and pay it off over time.

The big question he has is, will he be able to get a loan modification and save his house?

Banks will almost always work with you if you can make payments

The good news for the Reddit poster is that banks usually really don’t want to take your house. Foreclosure is expensive for them, and then they get stuck with a property in unknown condition that they have to potentially fix up and try to find a buyer for.  All of this would likely cost the bank a lot more than the $17K that the poster owes on past-due payments. 

Because banks don’t want to foreclose if they don’t have to, his lender is very likely to work with him on finding a way to modify his loan so he can get current on the unpaid balance. That’s especially true since he has resumed making regular payments, and he is going to be able to continue to do so in the future. 

What should the Reddit poster do?

The Redditor’s best bet here is to reach out to the lender right away and not wait another minute. If the lender doesn’t know what has been happening or that the poster wants to work things out, they’d be more likely to move forward with beginning collections activity.

If the poster does reach out, though, the bank can help him to understand what modifications or options he has available. Banks can do many different things to help struggling homeowners, from changing the payment terms to extending the loan repayment timeline.

In this case, since the poster can afford his payments now, that type of drastic change may not even be necessary. The bank and the poster can just work out an option to deal with the $17K in outstanding debt. Calling the lender and discussing the issue is the best course of action because that’s the only way to know for sure what options are available.

The poster may also want to consider talking with a financial advisor who can help him make a plan going forward for paying the mortgage, digging out of the credit card debt, improving his credit score, and creating an emergency fund for the future. Advisors can offer invaluable suggestions in tough situations and can help him to get back on his feet so he can eliminate the serious financial worries he’s been dealing with due to his series of life disasters. 

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