Many factors can make it hard to make your mortgage payments

Sometimes unforeseen financial circumstances can result in your having difficulty making mortgage payments.  Or perhaps your financial stress results from taking on too much other high-interest debt. It can be tempting to want to hide or avoid your debt problem for as long as possible. But that’s never the best strategy. With early intervention, there are weapons available that can help you fight these demons! Your mortgage lender doesn’t want to see you default on your mortgage; they’d much rather help you find a way to keep your home, and get back on track.

Help with financial uncertainty

For mortgages insured by the Canada Mortgage and Housing Corporation (CMHC) and Sagen, they have assistance programs you may be able to access to help you ride out a period of financial uncertainty. For mortgages that aren’t insured, here are some ideas to help.

Seven tips that can help you get back on track financially:

1.  Skip-a-payment

Some lenders offer a “skip-a-payment” mortgage option that you can use.  Check with your lender to see if this would be available to you.

2. Switch from bi-weekly or weekly to monthly

If you’re currently on an accelerated bi-weekly payment schedule, ask your lender to switch you to a monthly payment schedule instead.  That way, you’ll avoid those months when you have 3 or 5 payments and gain a bit of breathing room.

3. Consider a fixed rate

Consider converting a variable-interest rate mortgage to a fixed-rate mortgage to give you a predictable monthly mortgage payment amount.

4. Extend your amortization

Ask your lender if you can extend your amortization period to reduce your monthly payments. You can shorten the amortization again later if your circumstances change, or make extra principal payments on your own terms when you have extra cash.

5. See if you can defer a payment temporarily

Your lender may be willing to offer a temporary payment deferral, or other flexible options for short-term relief. If you’ve made any lump-sum payments against your mortgage in the past – or if you’ve been on an accelerated payment schedule – that history can help.

6. See if you can add a payment to your principal

If you’ve actually missed a payment or a few payments already, ask if the lender is willing to add them to the mortgage balance and extend the payment period accordingly. (It’s best, however, to start talking before you start missing payments!)

7. Explore restructuring your debt

If high interest debt outside of your mortgage is throwing off your finances, consider refinancing the mortgage and the debt to ease the monthly payment burden.

Don’t delay!

Ultimately, it’s best to seek help at the first sign of financial trouble. Getting in touch and having a conversation is a great place to begin.

It’s possible that your financial situation just requires some extra penny-pinching to stay on budget. But if you find yourself adding to your credit card debt – or borrowing to make mortgage payments – then it’s time have that conversation. The earlier you get help, the easier it will be to conquer those debt demons!

Photo [c] Denys Golub for vecteezy.com