Homeowners may be locked into stable mortgage rates, but rising costs are still squeezing their budgets. Soaring insurance premiums, property taxes, and day-to-day expenses are making once-manageable payments harder to afford.
Amid inflation, layoffs, and market uncertainty, many homeowners are nearing a breaking point. Foreclosure filings rose in Q1 2025, according to real estate analytics firm ATTOM. But homeowners in this situation might be overlooking one crucial lifeline: their mortgage lender.
We spoke with five real estate and mortgage professionals who all emphasized the same thing: If you can’t afford your mortgage, get in touch with your lender. The lender is there to help.
Don’t ignore the problem
“Borrowers make the same mistakes over and over again. … They ignore problems,” says H. Jack Miller of Gelt Financial, a mortgage lender and servicer with more than 30 years of experience.
It’s the most common—and most costly—mistake struggling homeowners make. They stop opening letters. They let calls from their servicer go to voicemail. They cross their fingers and hope something will shift.
“Silence. Ignoring mail from the servicer or letting calls go to voicemail,” adds Catherine Barnett, a mortgage broker at LoanFit, ticking off the habits that push borrowers from financial stress into a full-blown crisis.
It’s a human impulse—when money gets tight, shame often follows. But lenders aren’t mind readers, and they’re not likely to offer help if they don’t know you need it. Avoidance doesn’t buy you time; it just narrows your options.
If you’re starting to feel the strain, don’t wait until you’ve already missed a payment. Proactive communication can mean the difference between a temporary setback and long-term financial damage.
Reach out early and honestly
If there’s one golden rule for navigating mortgage trouble, it’s this: Don’t wait to ask for help.
“First and foremost, contact your servicer immediately,” says Kristen D. Conti of Peacock Premier Properties. “After the crash of 2008 and the wave of foreclosures that occurred for the following 10 years, banks are now forced to have mechanisms in place to assist buyers in distress,” she says.
“The most important thing you can do is communicate, communicate, communicate,” Conti adds.
It’s easy to put off making the call, especially if you’re not sure what to say. But that silence can backfire, making it look like you’re abandoning your obligation rather than trying to work through it.
“Lenders don’t want to foreclose,” says Miller. “You can work it out.”
The key, experts say, is to reach out before you miss a payment—even if you don’t have a full plan in place yet. Your lender might be able to offer a forbearance, modification, or another solution that helps you stay afloat—but only if the lender knows you’re struggling.
And timing matters.
“If you make the lender’s phone ring early enough, doors of options swing open,” says Matt Schwartz of VA Loan Network. Those options can disappear if you’re already in default.
A hard conversation now can save you from far harder consequences later.
Come up with a plan—and a budget
Once you’ve opened the lines of communication with your lender, the next step is to figure out what’s possible—financially, emotionally, logistically. That starts with a clear-eyed look at your numbers.
“In all cases, prepare a realistic budget so you know what you can afford,” says Miller. That means no guesswork, no rounding up or down. Lenders want to see the facts.
Start by pulling together your income, expenses, and recent spending habits.
“Review [your] checking and credit card statements from the past three months,” says real estate consultant Lenny Richardson. “This can reveal unnecessary expenses” that could be cut or redirected toward your mortgage.
Once you know your limits, you can start exploring options that align with your situation—whether that’s partial payments, a modified loan, or something else entirely. And you don’t have to figure it out alone.
“Call your loan servicer, then call someone like me who can translate the options into plain English,” says Barnett.
Understand your options
Once you’ve taken stock of your budget and opened the lines of communication, it’s time to explore your options—and there are more than most borrowers realize.
“There isn’t a one‑size‑fits‑all order; we match the option to the timeline and the borrower’s stress level,” says Barnett.
In other words, your best move depends not only on the numbers but also on how urgent your situation is—and how long the hardship might last.
Forbearance
If the issue is temporary—a short-term layoff, medical leave, or unexpected expense—your lender might be able to offer a forbearance, which pauses or reduces your payments for a set period. But remember, those paused payments don’t disappear; they’ll typically need to be paid back in a lump sum or added to the end of your loan.
“For short-term issues, the servicer may be able to do a forbearance,” says Mason Whitehead, branch manager at Churchill Mortgage. “For long term … selling sooner than later is probably your best shot.”
Loan modification
If your income has dropped permanently or your mortgage is no longer affordable over the long haul, ask your lender about a loan modification—a restructuring of your loan terms that can reduce your monthly payment or extend the loan period.
“Be open and honest with your lender. Ask for a short-term or permanent modification of the loan into something you can afford,” says Miller.
Borrowers with government-backed loans might also qualify for unique tools.
“Partial claims or streamlined loan modifications can buy precious time without resetting the loan term,” says Schwartz.
Selling
If your financial situation isn’t likely to improve, it might be time to consider more permanent solutions, like a strategic sale—especially if you still have equity to protect.
“Be honest with yourself. If you really can’t afford the property, maybe you need to sell it … before it’s lost,” says Miller.
Equity can be a financial lifeline, but only if you preserve it. The longer you wait, the more likely it is to be eaten up by late fees, penalties, or even foreclosure. That’s why experts say that in some cases, a strategic sale isn’t giving up—it’s taking control.
Of course, it’s not an easy decision to make—and you don’t have to make it alone.
“Contact a local Realtor® who specializes in distressed property to discuss your options,” says Conti. They can help you understand your home’s value, evaluate timelines, and create a plan that protects your long-term financial health.
You don’t have to walk into that first conversation with your lender with all the answers. But understanding the menu of options, and matching them to your situation, can help you make a plan that sticks.
