If you miss your mortgage payments, foreclosure may occur. This is the legal means your lender can use to repossess your home. If you owe more than your property is worth, a deficiency judgment is pursued. Both foreclosures and deficiency judgments have a negative impact on your future credit. You should avoid foreclosure if at all possible.

Three steps can help:

• Do not ignore the letters from your lender. If you're having problems making your payments, call or write to your lender's Loss Mitigation Department without delay. Explain your situation. Be prepared to provide them with financial information, such as your monthly income and expenses. Without this information, they may not be able to help.
• Stay in your home for now. You may not qualify for assistance if you abandon your property.For example, the Hope for Homeowners program only offers 30-year fixed-rate mortgages to owner occupiers.
• Contact a HUD-approved housing counseling agency. Call 1-800-569-4287 or TDD 1-800-877-8339 for the housing counseling agency nearest you. These agencies are valuable resources.
• Contact Making Home Affordable for help. Call 1-888-995-4673 to talk to a HUD-approved credit counselor who will guide you through your options for free.

They frequently have information on services and programs offered by government agencies as well as private and community organizations that could help you. The housing counseling agency may also offer credit counseling. These services are usually free of charge.

For more information, resources are available at the following agencies:

• The U.S. Department of Housing and Urban Development
• The Federal Trade Commission