After my interview on FOXbusiness.com yesterday with Jenna Lee, Connell McShane and Dagen McDowell, it was clear from the emails that there are many people who are facing catastrophic problems paying their mortgages and, very worryingly, many are waiting that the government intervenes to solve the problem. Although we hope to have useful answers and solutions tomorrow on what the government plans to do, there will still be a period of time to enact those policies. In my experience, that takes some time, which a lot of people don’t have. Therefore, I feel that those who are struggling should continue to take steps in the interim to prepare to alleviate their situation. For those who find themselves in those situations, here are some simple steps to get you started. More tips coming soon:

1. Try to keep up: A foreclosure is devastating to a person’s credit and future access to credit, which is why we want to avoid it at all costs. Try to keep the mortgage up to date.

2. Set a budget: Determine all income and all expenses to understand where the money is going;

3. Reduce and Eliminate Expenses: Reduce necessary expenses as much as possible (reduced insurance premiums, reduced utility usage and costs, reassessed property taxes, food, clothing, and transportation budgets) and eliminate those that are unnecessary;

4. Add income or sell personal belongings: If necessary, find part-time work or additional income or sell items you don’t need (through things like Craig’s List, etc.)

5. Negotiate unsecured debt payment plans: If payments are still too high to pay mortgage payments, negotiate with unsecured creditors for modified payments and immediately stop using credit cards and debt. Once again, the desire is to pay off the debt, only on modified terms.

6. Determine the Maximum Affordable Mortgage Payment: Once all the steps above have been completed, determine the maximum you can afford to pay. If you can afford to mortgage payments in the future, stay within your budget and weather the storm. If you are able to pay your mortgage payments but cannot make up the missed payments OR you are still unable to pay the full mortgage payments, then;

7. Contact the lender to discuss the modification: Now contact your lender to discuss modification options. This may include a forbearance where you agree to make up overdue payments over time, or a deferral of overdue payments until the end of the loan (thus bringing it current), or an actual modification of the loan terms, including payment and/or or rate reduction and/or term increase. Please have all your income verification and budget information ready. Make a plan of what you have done to reduce and eliminate expenses or increase income. Show the lender that you’ve done your homework. Try to meet face to face if possible. If you are not satisfied, contact an attorney to help you with negotiations.