Mortgage Debt

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The rate at which people are acquiring mortgage debt is alarming at this point, ever since the pandemic has left the majority of the population in an economic crisis. Our debt relief Texas experts help you get out of mortgage debt and be worry-free about the ownership of your house. 

If you have any questions about our mortgage debt relief services, do not hesitate to give us a call today.

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What is a Mortgage?

The rate at which people are acquiring mortgage debt is alarming at this point, ever since the pandemic has left the majority of the population in an economic crisis. Our debt relief Texas experts help you get out of mortgage debt and be worry-free about the ownership of your house. 

If you have any questions about our mortgage debt relief services, do not hesitate to give us a call today.

How Do You Accrue Mortgage Debt?

Whether you are an individual or a business, you can use a mortgage to buy a house or real estate. Then, you have to repay this loan in a predetermined number of years by paying a certain amount of money every month. 

If you stop making your regular payments, the lender will foreclose on your property. For example, if you want to buy a home, you will take a mortgage to do so. The lender will give you a loan to buy the house while keeping the said house as collateral. 

You will have to repay the loan as per the guidelines agreed upon by both parties. In the unfortunate event that you are unable to make your payments, the lender may evict you from your home and sell it. 

Then, they will use this money to repay the remaining debt. However, this will not happen if you only miss a single payment. But what actually happens is that you start gathering debt. The more payments you miss, the more your debt increases. 

Thus, it is definitely not good news, as you are not only paying more in the long run, but you also put yourself at risk of being evicted from your home. Therefore, it is important to deal with mortgage debt as soon as you think things are getting out of hand.

Contact us today to learn about our mortgage debt relief solutions.

(281) 941-6809

debt relief texas

A Rise in Mortgage Debt

According to Experian data, mortgage debt has gone up by 2% per individual, which is the highest increase in the past decade. That is quite alarming, considering the majority of homeowners have taken a mortgage to pay for their homes. 

In the third quarter of 2020, the outstanding mortgage debt in the US increased to $10.3 trillion. Experian reports that this is the worst economic recession of this type ever since the Great Depression.

What is a Mortgage Forbearance Agreement?

Keeping the economic impact of the pandemic in mind, it is not a surprise that many people are struggling to make their mortgage payments. A mortgage forbearance agreement is an agreement between the delinquent borrower and the lender. 

The agreement says that the borrower will not exercise their legal right to foreclosure if the borrower agrees to a plan that will allow them to come on their currency payments. 

The initiative was offered under the CARES Act, which was given to the public in the wake of the economic uncertainty brought about by the pandemic. Mortgage companies, as per this Act, were required to reduce the payments for the borrowers or suspend them for up to 180 days. 

If you have availed forbearance, you need to still be in touch with the mortgage servicer to decide how you will repay the amount the company let you forgo earlier. Here are some options:

  • Repayment Plan: As per this option, the amount of your monthly payment is increased unless you repay the amount that you were allowed to forgo earlier.
  • Payment Deferral: In this option, the repayment is deferred for the time. You then repay the amount, along with the interest, at the end of the mortgage term. You have to pay the amount in full. It is your final payment for the mortgage.
  • Lump-Sum: You can repay the amount in full when your forbearance period ends.
  • Loan Modification: In this option, the length of your loan is modified. The mortgage company will give you a new loan for the amount that you got forbearance for, along with your remaining mortgage balance. As a result, your monthly payments may be lowered, but your total interest will be higher, and you will be making repayments for a longer period than your initial mortgage plan.

How to Pay Off Mortgage Debt Quickly?

The Debt Relief Programs Texas Counts On

The best way to prevent the accumulation of excessive mortgage debt is to make sure you are paying it off as quickly as possible. Our debt relief Texas plans also revolve around the same principle, helping people pay off their mortgage debt and protect themselves from foreclosures or evictions. 

Here are some ways to pay off your mortgage early:

Make Frequent Payments

Depending on your mortgage plan, your payment will most probably be a monthly instalment. However, if you want to pay off your mortgage early, you can make two payments of half the size in a month.

For instance, if your mortgage payment is $1000 per month, you can make two payments of $500 a month. At the end of the day, you are taking out the same amount of money from your budget to pay off the mortgage.

But it calculates to more payments than what you would get if you made monthly payments. A year has 52 weeks. If you make a payment every other week, you will make a total of 13 payments. On the other hand, if you pay monthly, you will make 12 payments.

That is an extra payment you are making without adding in any extra money. But why would you do that if you are still paying the same amount of money every month? You save money on paying interest.

If you make biweekly payments instead of monthly instalments, you will pay less in interest. For instance, if your mortgage plan is 30 years long and you have to pay off $200,000 with a 5% interest rate, you will save $34,328 in interest by making biweekly payments rather than monthly payments.

Along with paying less, you will also be finishing your mortgage much earlier – approximately five years.

Refinance Your Mortgage

Another way to pay off your mortgage faster is to refinance it. For instance, if you have a mortgage lasting 30 years, you can refinance it to 15 years and pay it much faster. Plus, you will get a better interest rate if you have a shorter repayment term.

Since you are paying off the amount in fewer months, you do not have to pay the additional interest that you would have to pay if you finished your mortgage in 30 years.

Allocate Extra Funds

Now here is something that most people are unable to do. But if it is possible for you to allocate extra funds towards your mortgage repayment, you should definitely do it.

For instance, if you have received a work bonus or a raise, you can keep a fraction of it to pay off your mortgage much faster. For instance, if you are currently making $5000 and you get a raise of $200, your monthly income will now be $5200, but you do not necessarily need that extra $200 since you already have a budget in place without that amount.

Instead of using that money on dining out or other things, you can simply put it towards mortgage repayment. It will pay off in the long run since you will be finishing your repayment earlier and saving money by not paying all that extra interest.

Get Help Against Mortgage Debt

The Texas Debt Relief You Can Trust

Just because you have accrued some mortgage debt does not mean you should let it increase over time and end up with no roof over your head. Instead, you should get help as soon as possible. 

The US Department of Housing and Urban Development has housing counselors who can guide you on the possible options for repaying your mortgage debt and not losing your home. Likewise, the CFPB also provides a directory that you can use to find an attorney in your area to navigate the legal proceedings surrounding a foreclosure. 

If you are confused about what to do or are uncertain of what your next step should be, get in touch with us, and one of our representatives will be at your service urgently. 

We have long-term experience in helping people get out of debt, so you can approach us with immense trust. Call us today to learn more about our debt relief Texas services.

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