Interest Free Loan For Homeowners Behind On Mortgage Payments

Q: When my husband lost his job, we fell behind on our mortgage payments. He’s working now, but we don’t have enough money to pay back all the mortgage payments we missed. Is there anything we can do? Ingrid, Bloomingdale, NJ

A: A partial claim is an interest-free loan provided by the US Department of Housing and Urban Development (HUD) to cure a mortgage borrower’s delinquency when the borrower is behind on mortgage payments. A partial claim mortgage allows homeowners struggling to make payments to defer missed mortgage payments as a subordinate lien on their property. Eligibility requirements generally include 1) being several months behind on mortgage payments,2) demonstrating an ability to resume future payments, and 3) residing in the property as a primary residence. A partial claim loan is a good deal for struggling homeowners behind on mortgage payments because in addition to being interest free, HUD does not require payments on a partial claim loan–the partial claim loan just must be paid off when the original mortgage matures or when the home is sold. A partial claim loan is essentially a 2nd mortgage with no interest or payments and are usually associated with FHA loans. Thanks for your question, Ingrid.

Thanks for your question, Gary. For more real estate tips and information, visit my blog at geraldlucas.com.