When you are at risk of defaulting on your mortgage, or have already fallen behind on your payments, you may have a number of options for keeping your house:
Refinance your mortgage under the federal Home Affordable Refinance Program, or HARP. Usually, refinancing is available only if you have equity in your home—something that is increasingly rare in many parts of the country. However, under the new government-sponsored refinance program, you may be able to refinance your current mortgage into a 15- or 30-year fixed-rate mortgage. This may not reduce your payment much in the short term, but it will avoid nasty interest rate resets that might be in your future under your current mortgage. More on HARP can be found in our article on refinancing or modifying your mortgage under the Making Home Affordable program.
Lower your monthly mortgage payment under the Home Affordable Modification Program, or HAMP. This government-sponsored program provides a way to lower the monthly payment on your first mortgage to 31% of your gross income. HAMP is also discussed in our article on refinancing or modifying your mortgage under the Making Home Affordable program. â