For months, one thing after another kept happening to Claire. She was in a car accident. Then, the kitchen sink needed to be repaired. After that, her twin daughters, who were both disabled, fell ill and needed extra in-home care and therapies. Already stretched to the max with her budget, these unexpected expenses pushed her past what she could possibly pay on her limited Social Security Disability income. She began to fall further and further behind on her mortgage.
At that point, Claire’s lender supplied her with a list of possible Housing Counseling agencies to contact, and that is when she first heard of the Neighborhood Christian Legal Clinic. “She came to us because she was in a tough spot. She is a single mother, which is hard enough,” says Jill Knight, a Certified Housing Counselor in the Consumer Justice Program (CJP). “But she also struggles with disabilities of her own, in addition to caring for her children, who also have disabilities.”
Before this breaking point, Claire had never fallen behind on her mortgage. But, after her husband left her and their children, and once all of the extra expenses popped up, she could no longer manage. She needed help to reach a new agreement with her lender. “Mortgages are a complicated process,” says Jill. “Even people that are really astute about that type of thing are often surprised by how hard it can be to handle.”
After meeting with a Housing Counselor to prepare and send a hardship packet to her lender, Claire was given a modification of her loan. And the CJP also helped resolve the issue with the money she owed from missed payments. “The long and the short of it is, if you fall behind on your mortgage and you owe [the lender] money, at some point or other, you’re going to be liable to pay that back,” says Jill. Fortunately for Claire, because she has an FHA loan, she was able to work out an agreement where the back payments were added to the end of the loan, rather than rolled back into the principle. “They’re still a lien against the house,” Jill says, “But in 30 years, or whenever that loan comes due, or when she sells the house, that will need to be dealt with.” The benefit of these overdue payments not being rolled back into the principle is that Claire will not have to pay interest on them.
Thanks to the help of the CJP, her monthly payments are at a lower, fixed rate that is affordable for Claire and her family. “Life is still going to be a struggle,” says Jill. “The father is absentee and so she carries a pretty heavy load by herself.” But now, Claire will be able to move forward, paying her mortgage on time and without falling behind again, even if she hits a few more bumps in the road. “She was thrilled and very relieved,” says Jill. “I mean it’s stressful when people have problems with their mortgage, so it’s always a great weight being lifted when you say you have a solution--and it was a good solution for her.”
To learn more about our Housing Counseling Program, please visit our website.