My husband is the borrower and I am the co-borrower on our mortgage. My husband died 9/11/06. I am now 3 months behind on payment (had to pay for funeral). I no longer qualify for my husband's SS money, because my SS is higher. I can pay the mortgage myself if the bank would just put the 3 payments due on back. How can I get them to do this, because I cannot catch up. Borrowing to get out of this is not an option. Also, I would like to know if the loan can be re-written with just my income, making for a lower payment?

Hello mh:

Three things:

1) Scour the loan documents for any mention of credit life insurance, credit insurance, or ANY mention of insurance of ANY sort.

2) In any negotiation (like the one you're about to enter into), the only way to get what you want, is to give up something you don't want to give up. Plus, the bank has to have a financial incentive to bargain with you. For example, if your house is worth MORE than you owe, the bank will make more money by NOT dealing with you. However, if the bank is going to be on the short end of the stick (and that's where MOST banks in MOST markets find themselves today), because the house is worth LESS than you owe, then your bargaining position is strengthened. So, even though you say you can't borrow, if you're going to be successful, you better offer the bank some cash.

3) Payments AREN'T based on your income. They're based on how much you borrowed, for how long, and the interest rate at which you borrowed it at. Without your husbands' income, you wouldn't qualify for the loan, because you can't pay it, as you are so aptly demonstrating.

Bottom line: If you can't increase your income (dunno about that), or decrease your outgo (doesn't look likely), then you need to sell, quick before the bank takes it. Of course, if you have NO equity, and your husband left you with lots of other bills, maybe bankruptcy might be an option. It will at least STOP the proceedings and give everybody some breathing room. But, that option is going to cost some cash too.

I wish I had better news. My condolences.

excon

Yes as stated, the payment has nothing to do with your income, it is based on the interest rate at the time, based on how much is borrowed and for how many years

If this is from a local bank, go in and talk to them, if not local call and talk to a loan manger.

Be honest explain the situation, at 3 months behind you are close to getting foreclosed on.

Most banks will work out a deal with you to try and let you just keep paying and merely make you pay the payments at the end of the loan.
( forget the name for this, but this is done sometimes on people who talk to the lender and don't run and hide)

So I hope you have been calling the bank, telling them you can't pay and why. Not ignoring their phone calls.

So today or Monday, go down and talk to them

First, my condolences on your loss.

As Chuck noted, as long as you keep in contact, you stand a good chance of working something out. A bank can easily adjust the term of the mortgage to add the 3 payments on the end. They will be perfectly willing to do this under the circumstances, they don't want the publicity of going after a widow. Especially if they can add the interest accrued to the balance which they will probably do, extending the loan out further. But that still helps you because you need immediate relief.

As to refinancing, that depends on how much equity you have in the home. If you have a lot of equity, then refinancing could stretch the loan term out, lowering your payements. But the refinance will be based on the principle and term, not your income.