Sometimes, people living on the financial edge have to get creative. You might pay one bill this month and skip it the next month to keep it current enough to protect your vehicle or home.
Doing this may buy you time to stabilize your income, but it is costly in the long run. You may have fines and fees from missed payments, and you could find yourself threatened with legal action if you don’t start paying on time.
Missing a significant number of payments may result in you facing foreclosure. In Florida, your payment is considered late after 15 days and then, if you are still in default after 30, they may reach out to find out what’s going on. The lender has a responsibility to reach out to you within 36 days of your missed payment. The lender should also offer a loss-mitigation option to you, such as a short sale, deed in lieu or loan modification.
If you choose not to do those things or don’t talk to the lender, then you could find that the number of attempted contacts increases. Then, at 120 days, the lender can begin to file for foreclosure against you. Usually, the lender won’t be able to file for foreclosure before that point due to the Dodd-Frank Act.
What should you do if you can’t pay on time?
If you can’t pay on time, it is a good idea to look into the legal options presented to you. The lender should provide you with loss-mitigation options, and you have a right to take those to your attorney to review what would be best for your circumstances.
If you really cannot pay back what you owe, an option like a short sale might help you get out of the mortgage without having additional money to pay back to the lender. This, as well as other options, could get you back on track financially and into a better position moving forward.
If that won’t work, bankruptcy could help stop foreclosure until your financial picture can be made clear and you can decide if you will or won’t be able to pay.