QUESTION: Several months ago, I lost my job and have been living from savings and keeping current on my bills. I just found a new job, but it will be several weeks before I get paid and my savings account is depleted. Until I get paid, I won’t be able to afford my mortgage payments. What can I do?
ANSWER: Proper planning is the best way to minimize the damage from a temporary financial hardship. Doing nothing is the worst approach.
Make a list of all your bills and prioritize them. Items such as groceries, electricity, car insurance and community association dues are a must because not paying any of those causes immediate damage. Then look at your debt payments, such as mortgage, car, student loans and credit cards. Call your mortgage lender and explain the situation. Ask about a forbearance plan, which would allow you to skip payments - generally no more than 12 - while you get back on your feet.
Your lender will either tack these missed payments onto the end of your loan or require you to make larger monthly payments when the forbearance plan ends. To qualify for this, you will need to submit financial paperwork (tax returns and bank statements) and proof of your hardship. Carefully complete the requirements and patiently follow up with your lender. You may have to go through a similar process with your other creditors.
If you get turned down, repeat the application process because persistence is often rewarded.
Gary M. Singer is a Florida attorney and board-certified as an expert in real estate law by the Florida Bar. He is the chairperson of the Real Estate Section of the Broward County Bar Association and is an adjunct professor for the Nova Southeastern University Paralegal Studies program. Send him questions online at http://sunsent.nl/mR20t7 or follow him on Twitter GarySingerLaw.
The information and materials in this column are provided for general informational purposes only and are not intended to be legal advice. No attorney-client relationship is formed. Nothing in this column is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction.