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Mortgage rate jump -- what to do

Facing a mortgage reset? Know your options. The first line of defense is understanding the terms of your adjustable rate mortgage. Take the time to figure out both when rates will change and how high they can go when they do. Once you know the potential damage, Peter Milewski, MassHousing's director of mortgage insurance, says that you should:

Contact an attorney if you don't understand your mortgage documents. If you can't afford one, try a local counseling agency or a community bank that may help free of charge. You can find HUD-approved housing counselors at its website, hud.gov, or by calling 1-800-569-4287

Let your lender know as soon as possible if you will have trouble meeting the new monthly payments. Ask for the "foreclosure prevention department." If the lender won't help you and you are current on your mortgage payments, you can look for refinancing elsewhere.

Find reputable lenders if you want to refinance. MassHousing, which works to provide housing opportunities for those underserved by conventional markets, offers both referrals and special refinance programs for borrowers hit with monthly payment increases caused by resets. For more information go to masshousing.com.

Call the Homeownership Preservation Foundation Hotline at 1-888-995-HOPE if you are already behind on your payments or need other advice.

Call the Massachusetts Division of Banks at 1-800-495-2265, ext. 1501, if you feel you have been the victim of deceptive lending practices.

SOURCE: Lynn Asinof

 
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