Refinancing your mortgage may look appealing now with new low interest rates, if you have recently lost your job, however, that may be the wrench in your plan. Generally, refinancing a mortgage while unemployed is nearly impossible. The things the mortgage company will ask for are:

• A W-2 Statement
• Ability to show steady income
• Years with your current job

Renegotiating a loan if Unemployed

CNBC recommends, “The most common steps recommended by experts to take for renegotiating a loan for someone who’s unemployed are:

• Find out who services the loan by contacting the bank or lender you pay monthly
• If the servicer cannot help after using the following steps, find out who actually owns the loan and deal directly with them.
• Call the servicer or lender immediately and speak to someone in the loss mitigation department as soon as possible about refinancing
• Write what’s called a forbearance letter or postponement of payment letter to either the servicer or lender telling them of your situation
• Be prepared to provide documentation of unemployment or income loss of you or your spouse
• Keep accurate copies of anything you send to a servicer or lender.”

Knowing who owns your mortgage, speaking with them and having persistence might be your best option in trying to get somewhere with refinancing your mortgage while unemployed.

If your attempts to refinance fail, look into mortgage forbearance.

Look into Mortgage Forbearance

With Mortgage Forbearance, your payments are postponed in exchange for adding any interest unpaid to your principle which will increase the amount you owe.

This is ideal for someone that has a short-term change in income.

Other Options for Making Your Mortgage Payment

If a foreclosure is looming, these options may offer relief.

• Rent out your home
• Principal reduction
• Refund your VA loan, if you have a VA loan

Coronavirus Mortgage Relief

If you are specifically looking for relief during the pandemic, know that leaders are offering payment deferrals with no late fees. Call your lender to find out if this applies for you and your loan.

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