Behind on Your Mortgage? Honest Options Before Foreclosure

First, the good news: one or two missed payments isn't a foreclosure. Pennsylvania and federal rules build in time, notices and free counselors first. We buy houses, but we'll be straight with you: selling to us often isn't your first move. Talking to your mortgage company and a free counselor usually is.

What happens when you miss mortgage payments in Pennsylvania?

It happens in steps, and every step gives you a chance to act. Here's the whole clock in one place, from the first missed payment to the last chance before a sheriff sale:

The fine print: these federal rules cover the loan on the home you live in. Small servicers are exempt, but even they can't make a first foreclosure filing before you're more than 120 days behind.

What should you do this week?

Make two phone calls and start a folder. That's it for now. And don't pay anyone up front: real help from counselors is free.

1. Open every letter. The scariest envelope usually has the deadlines and phone numbers you need.
2. Call your servicer. Ask how much it takes to catch up, what help it offers, and exactly what a complete application needs. Write down the date, the person's name and what they said.
3. Call a free housing counselor. In Philadelphia, that's the Save Your Home Philly Hotline, (215) 334-4663. Anywhere, the CFPB will connect you to a HUD-approved counselor at (855) 411-2372, or you can search its counselor list online.
4. Start a folder. Pay stubs, bank statements, tax returns, your mortgage statement and anything that shows why you fell behind, like a layoff notice or medical bills.

What is an Act 91 notice, and what should you do in the next 33 days?

It's the letter Pennsylvania law makes lenders send to homeowners facing foreclosure, and it comes with a lifeline: a free counselor and a shot at a state loan. Don't set it aside.

1. Read the whole thing. It shows the amount to catch up within 30 days of the notice date, and whether your mortgage can be taken over (assumed) by someone else. Keep every page, including the Account Summary.
2. Call a counselor on the attached list today. You need a face-to-face meeting with a HEMAP-approved counseling agency within 33 days of the date on the notice. It's free, it can be in person or remote, and it's the only way to apply for HEMAP.
3. Write your letter of circumstances. PHFA asks for a signed letter explaining exactly why you fell behind, with proof, like a layoff notice or medical bills.
4. Gather the papers. PHFA's list includes your Act 91 notice, photo ID, your three latest pay stubs, proof of other income, five years of work history, three years of tax returns, your deed, loan and bank statements, your insurance policy, and three summer and three winter utility bills.
5. Ask the counselor about everything. The notice says a counselor can help you apply for HEMAP, talk with your lender about a modification or repayment plan, and explain other ways out, including refinancing, selling, a short sale or having someone take over the mortgage.

Can HEMAP help you catch up?

It can, if your trouble came from something you couldn't control and you can get back on track. HEMAP is run by the Pennsylvania Housing Finance Agency (PHFA).

What free help is there in Philadelphia?

A lot, and none of it costs you a dime:

The Mortgage Retention Grant has rules: household income under 250% of the federal poverty level ($39,900 a year for one person, $82,500 for a family of four), a money crisis with no other way to catch up, the ability to keep up the payments afterward, and no application in the past 24 months.

The court's conferences are held Thursdays in Courtroom 676 of City Hall. Once a case is filed, our guide to stopping a sheriff sale picks up the story.

What can your mortgage company offer?

Usually more than one way to catch up, and you can ask about all of them:

The CFPB notes that a deed in lieu can still leave you with a tax bill, so talk with a tax professional before you sign one. Going through a divorce? Our guide to selling a house during a divorce covers who signs and who pays.

When does selling make sense?

When the numbers say you can't catch up and stay caught up, selling while you still have equity protects it. To check:

1. Get a written payoff statement. Ask your servicer for the full amount to pay off the loan, including the missed payments, interest and fees.
2. Find out what the house is worth. Get an agent's opinion of the list price and our written offer, so you're comparing real numbers.
3. Subtract everything you owe. The payoff, plus any back taxes, water bills or other liens. A HEMAP loan, if you have one, is recorded as a mortgage too.
4. Subtract the cost of selling. Listing usually means a commission and your share of the transfer tax. Our guide to what it costs to sell in Philadelphia has real numbers.
5. See what's left. If it's money, selling puts it in your pocket at closing. If you owe more than the house is worth, ask your lender about a short sale.

Selling isn't the right call if your hardship is short-term and you qualify for HEMAP, or your servicer offers a payment you can truly afford.

How do you spot a foreclosure rescue scam?

Easy: real help never asks for money up front. The CFPB says scammers may:

• ask you to pay fees before they do anything
• promise to get you a loan modification
• ask you to sign over the title (deed) to your house
• ask you to sign papers you don't understand
• tell you to send payments to someone other than your servicer
• tell you to stop paying your mortgage altogether

Mortgage relief companies can't collect any fee until you have a written offer from your lender that you decide to accept. You can report a company to the CFPB online or at (855) 411-2372. And here's how to check any company that sends you letters, us included.

What if your house is in the suburbs or South Jersey?

In the Pennsylvania suburbs, the same federal rules, Act 91 notice and HEMAP apply, and PHFA lists counselors by county. Our sheriff sale guide covers sale days in Bucks County, PA, Delaware County, PA and Montgomery County, PA.

New Jersey works differently. Before going to court, the lender sends a Notice of Intent to Foreclose. The New Jersey courts say you have 30 days from getting it to pay what the notice says it takes to cure the debt, or make other arrangements with the lender, and you can ask for mediation then. Mediation is free, but the lender can keep the case moving during it, so ask early. Our New Jersey foreclosure guide covers the rest of the timeline in South Jersey.

How can we help if selling is the right move?

At Vivid Properties, we buy houses as they are, with no repairs, no cleanout and no showings, as long as the sale pays off your lender or your lender approves a short sale. You'll get a fair written offer, usually within 24 hours, showing what you'd walk away with after the mortgage and any liens are paid off. We pay all the closing costs, there are no fees or commissions, and you pick the closing day, so you can line it up before the next deadline on your papers.

Our price will be less than a fixed-up house would list for, because we take on the repairs, the risk and the costs of holding and reselling it. If listing your house would put more money in your pocket, we'll tell you. No pressure either way. See how we calculate our offer and how selling to us compares with listing.

We're a local, family-owned company, and a real local person answers when you call or text. We buy in Philadelphia, Delaware County, PA, Bucks County, PA, Montgomery County, PA and South Jersey.

Get my cash offer Text or call (267) 551-5554

Common questions

This guide is general information, not legal or tax advice. For your situation, talk to a Pennsylvania or New Jersey attorney or tax professional.