David wrote to me at GetOutOfDebt.org and asked me for help with his debt situation. If you have a question, you can ask me for free help and advice also.
“Dear Steve,
I accepted a job in Seattle. My wife and family and home are still in Idaho. My wife is on a fixed income, and we have been hanging on by a thread for the last 6 months. I was just laid off.
Our house payment is killing us. Is there a source for grants for people in tough situations
We have to sell our house but cannot drop the price. Are there sources of grants available.
David”
Dear David,
The only time I have seen any sort of money really available in a situation like this has been for union members, check with your trade union if you belong to one, or for current employees of large companies with support services like the Clara Abbott Foundation, an awesome resource for Abbott employees.
From what you’ve shared it sounds like you have fallen into the headlines on the nightly news and become subject of something much larger than you as an individual.
Your situation is typical with 10,000 foreclosures a day happening as I write this. Those 10,000 homes belong to families just like yours. They belong to people who have found themselves in impossible situations without seemingly any way out.
I would encourage you to contact your mortgage company and explain to them what has happened. Who knows, maybe you’ll be one of the one in ten that actually gets meaningful help from the mortgage company and get your loan modified so that you can actually afford it.
You don’t need to worry about being honest with them about your situation, they will discover soon enough that your ship is sinking fast.
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The three most realistic solutions here are:
- Increase Income – I know, easier said than done. But use the job bank page I put together. It is a free service that helps you to identify open jobs in any state. Income now will bridge that gap.
- Bankruptcy – Bankruptcy won’t make your home payment for you but it will allow you to eliminate your debt and obligations for a home that you simply may not be able to afford right now. Finding a bankruptcy attorney and getting a free bankruptcy review is always a smart thing to do.
- Pay Only What You Can Afford On The Mortgage Right Now – I know, you’re probably saying I’m crazy for saying that but read on. If there is not enough money coming in to make a full mortgage payment you can always send in what you can afford to pay. Now that partial payment will put you behind but at least by sending in what you can afford now it will reduce the amount you’ll have to catch up once you get another job.
The partial payment will put you in default and hurt your credit report and credit score but as long as you are open, honest, and not a jerk with your lender then your past due mortgage will begin to flow through the normal process for delinquent mortgages. That will buy you some time to find a new job.
Once you are behind on the mortgage then the lender may be more willing to talk about solutions for your mortgage situation. As long as you are current on your loan, lenders don’t want to tell you what they can do for you, they want you to make the regular loan payment.
With the number of past due mortgages flooding the lenders, yours will just be another in the stack. They will not take your home this month or next month or maybe for many months.
Use that time to make a job of getting a job and spend eight hours a day looking. Try temporary companies, the job board link I gave you or one of the other many places online.
You can keep your spirits up to face the hard task of looking for a job if you draw a line in the sand and agree to evaluate your situation again in say 60 days. Until then, pay what you can really afford, don’t overpay, on the mortgage and hunt, hunt, hunt for that new job with optimism and hope.
While the economic conditions sound dire in the news, the unemployment rate is still relatively low and jobs can be found.
Please come back and let us all know how things turn out.
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