Missed a Mortgage Payment? Your First 60 Days Explained

Missed a Mortgage Payment? Your First 60 Days Explained

At‑a‑glance timeline

• Days 1–7: Verify status, stop unnecessary outflows, organize documents

• Days 3–10: Call your servicer’s Loss Mitigation team and submit a complete package

• Days 7–21: Choose a track based on income and hardship

• Days 14–45: Execute, respond quickly, and track legal notices

• Days 30–60: If denied, fix the reason and re‑submit or pivot

Phase 1: Verify and Stabilize (Days 1–7)

• Confirm the facts
• Log into your servicer portal. Verify amount due, due date, grace period, and late fee policy
• Check escrow changes (taxes or insurance) that may have raised your payment

• Stop the bleed
• Pause or cancel autopay to avoid NSF fees
• Prioritize the four walls: housing, utilities, transportation, food

• Build a mini cash map
• Identify what you can free up in 30 days: subscriptions, discretionary spending, optional debt prepayments
• If you expect income within 30–45 days, note dates and amounts to inform your proposal

Phase 2: Contact Your Servicer (Days 3–10)

• What to ask
• “What is my exact delinquency status and the next legal milestone on my loan?”
• “Which workout options am I likely to qualify for based on my hardship and income?”
• “What specific documents do you need and where do I upload them?”

• Prepare a clean package
• Last 30–60 days of paystubs, two most recent bank statements, hardship letter, full mortgage statement
• Property tax and insurance details; proof of additional income if applicable

• Scripts that work
• “I want to prevent fees and protect my credit. I can submit a complete package today. Please confirm the correct intake email or portal and the exact document list.”

Phase 3: Choose Your Track (Days 7–21)

How to pick the right track (decision guide)

• If you can clear the total past due within 30–45 days without missing other essentials → Reinstate

• If income is steady but the lump sum is unrealistic → Repayment plan over 3–12 months

• If income has reset lower for 6+ months or debt ratios won’t pencil → Modification

• If affordability won’t return inside 60–90 days or sale deadlines are looming → Sell for speed and certainty

Sample hardship letter (1‑page template)

• What happened: “On July 14, I was laid off from Acme Co. My income fell from $6,400/mo to $2,100/mo unemployment.”

• What changed or is changing: “As of Sept 1, I accepted a new role at $5,200/mo. Start date is Sept 29.”

• What you can afford now: “I can afford $2,100/mo for three months (trial), then $2,450/mo thereafter.”

• What you are requesting: “Please evaluate me for a modification with these payment targets, or a repayment plan if approved sooner.”

Income math the reviewer will check

• Front‑end DTI target often 25–35% (program‑dependent)

• Back‑end DTI target often 45–55% with documented debts

• Stability: 30–60 days of consistent deposits for wages; 12–24 months history for self‑employment

• Proof: paystubs, award letters, bank statements showing deposits

• Reinstatement (catch up in one payment)
• Best if income is stable and the miss was a one‑off

• Repayment plan (spread arrears over several months)
• Good for temporary hardship with consistent income

• Loan modification (change rate, term, or payment)
• For sustained affordability issues; expect a Trial Period Plan (TPP) before final docs

• Sell before timelines compress
• If affordability won’t recover soon, price for attention and speed to preserve equity

Tip: If you have FHA or VA, ask about program‑specific options and timelines. Rules differ by loan type.

Phase 4: Execute and Communicate (Days 14–45)

• Submission hygiene
• Combine documents into one clear PDF. Use descriptive filenames. No missing pages
• Respond to requests within 48 hours

• Track legal dates
• Non‑judicial states may move quickly after a Notice of Default
• Judicial states differ, but the clock still ticks—log every notice and deadline

• Credit protection
• Ask if evaluation or forbearance pauses adverse reporting. Get confirmations in writing

Phase 5: If the First Answer Is “No” (Days 30–60)

• Identify the blocker
• Common issues: Missing docs, debt‑to‑income (DTI) too high, unstable income history

• Fix and re‑submit
• Update docs, add explanations, or adjust proposal amounts

• Pivot if needed
• Repayment → modification, or modification → sell for speed and certainty

Quick FAQs

Common mistakes to avoid

• Waiting to call the servicer until you can pay in full

• Sending an incomplete package or missing pages

• Letting quotes expire before paying a reinstatement

• Ignoring mailed notices because the portal isn’t updated yet

• Promising an amount you can’t sustain on a Trial Plan

Example scenarios (so you can model your plan)

• One-time miss, income stable: Reinstate within 30 days. Ask servicer to waive late fee in writing

• Hours cut, income recovers in 45 days: Repayment plan over 6 months. Document temporary hardship and return-to-work date

• Income permanently lower: Request modification with a realistic target payment. Expect a 3-payment Trial Period Plan

Related posts and tools

• Short Sale Timeline 2025: How Long It Takes and How To Speed It Up →
  Short Sale Timeline 2025: How Long a Short Sale Takes and How To Speed It Up

• How to Handle Offers on Short Sales →
  🧭
  How to Handle Offers on Short Sales: Primary, Backups, and Earnest Money

• What Is an REO Property? →
  
  What Is an REO Property? How Homes Become Bank Owned and How To Buy One

Bottom line

• Will one late kill my credit?
• A 30‑day late hurts, but acting fast may prevent a 60‑day late and cascading fees

• Can I still get forbearance?
• Some programs remain, but availability varies by loan type and servicer. Ask and get it in writing

• Do FHA and VA have special options?
• Often yes. Evaluation rules, waterfalls, and timelines vary by program

Your 10‑minute action plan (print this)

1. Log into your servicer portal. Confirm status and amounts due today

2. Call Loss Mitigation. Ask for your likely options and the exact document list

3. Pick a track: reinstate, repay, modify, or sell. Submit a complete package this week

4. Calendar 10‑day check‑ins until decision. Track legal notices and respond within 48 hours

Helpful next steps

• Gather docs with this checklist: paystubs, bank statements, hardship letter, mortgage statement, tax and insurance info

• Write your hardship letter in one page: what happened, when it started, what’s changed, what you can afford now

• Unsure of loan type? Check your statement or ask your servicer directly