Question 1

Will a hardship plan hurt my credit?

Accepted Answer

It depends on the lender and plan. Ask how it will be reported. A plan usually hurts less than missed payments.

Question 2

Should I use retirement money to pay debts?

Accepted Answer

Usually as a last resort, because of taxes, penalties and lost savings. Talk to a counselor first.

Question 3

Should I call my lender before I miss a payment?

Accepted Answer

Yes. Lenders usually have more options before you’re behind, and you avoid late fees and credit damage.

Question 4

What is a hardship program?

Accepted Answer

A temporary plan from a lender, like lower payments, lower interest or paused payments, for people facing job loss, illness or other money trouble.

Question 5

What is mortgage forbearance?

Accepted Answer

A temporary pause or reduction in mortgage payments. You’ll usually need to repay the missed amount later through a plan or modification.

Question 6

Which bills should I pay first when money is short?

Accepted Answer

Usually housing, utilities, food and transportation to work, then secured debts, then unsecured debts like credit cards.

Question 7

Are debt settlement companies a good idea?

Accepted Answer

Be careful. Many charge high fees, hurt your credit and don’t settle all debts. Try lenders and nonprofit counseling first.

Question 8

Where can I get free help with my mortgage?

Accepted Answer

From a HUD-approved housing counseling agency. Their help is usually free.

Common questions: Talking to lenders