NEW YORK (CNNMoney.com) -- Struggling to pay your FHA mortgage? Now you no longer have to be late with your payments to get help.
On Friday, the Federal Housing Administration announced that it will assist borrowers before they become delinquent. All you need do is prove your problems were caused by a reduction of income from a job loss, fewer paid hours, slashed wages or a decline in self-employed business earnings.
You may also qualify because of a change in household circumstances, such as a death or disability.
"The FHA has always required lenders to establish early contact with delinquent borrowers to discuss the reason for missing a payment and to evaluate reinstatement options," FHA Commissioner David Stevens said in a prepared statement. "Now servicers will have additional options for those borrowers who seek help before they go delinquent, which increases the likelihood that the borrower will be able to retain their home."
The workouts available include forbearance, in which lenders agree to postpone or reduce payments for a specified period. This does not actually forgive the payments, they are just added to balance later in the mortgage term.
In more severe cases, borrowers may qualify for permanent payment reductions. This may be done by increasing the length of the loan, reducing the interest rate or even forgiving principal -- or a combination of any of the three.
|Overnight Avg Rate||Latest||Change||Last Week|
|30 yr fixed||3.90%||4.01%|
|15 yr fixed||3.01%||3.13%|
|30 yr refi||3.98%||4.12%|
|15 yr refi||3.08%||3.23%|
Today's featured rates:
Some families are outraged at the sums they've been offered by Lufthansa as compensation for the Germanwings plane crash in March which killed 150 people. More
Puerto Rico is expected to default on its debt Monday. Here's what you need to know. More
Luxury European automakers Audi, BMW and Daimler have teamed up to acquire Nokia's mapping and location services business for 2.8 billion euros ($3.1 billion). More
Candle-Lite is committed to manufacturing in America -- which is a good thing because it contributes more than $300 million to Ohio's economy. More
You can't blame it on the economy anymore. More Millennials now have jobs, but are still living at home. More