This is what you have to do if you can no longer pay your mortgage

Acquiring a house in Mexico is one of the main goals many set for themselves, but it becomes a priority when starting a family life. One option for this is to resort to mortgage credit.  

Although it is a reality that their financial situation changes over time for some families, and they no longer have sufficient resources to meet the expenses of the credit they acquired. We ask ourselves, " what do I do if I can no longer pay my mortgage ?"

Before reaching the point of not being able to afford the mortgage

Mortgage debt restructuring comes when you have certain situations where you go through stages of economic difficulties, and that is when we can get ahead and do the following activities: 

  • Go to the mortgage loan's Bank or creditor entity to explain the situation and renegotiate the credit conditions.  
  • Negotiate the extension of the duration of the credit in exchange for the monthly payment being reduced. So, even if we have economic difficulties, we should not stop paying our mortgage loans.  

If it is the case in which you had to stop paying your mortgage loan.

For example, because you could not reach an agreement with the Bank, sometimes there is no other option than to stop paying. Now, answering the question: What do I do if I can no longer pay my mortgage? We will divide it into three stages:

1st STAGE - One month late

If a month has passed since you stopped paying, the Bank will contact you by phone or mail to verify if the non-payment is due to an error. You are giving you the option to settle the debt, with its respective default interest, to solve the problem. 

Keep in mind that most banks and creditors are willing to negotiate with customers who contact them.

You can either seek a debt restructuring or an extension of time at this stage. 

2nd STAGE - Three or four months of debt

If you have three or four unpaid monthly installments, the delay in your credit will be considered legal default, and the Bank may formally request payment.   

Suppose you know that your financial situation will be regulated quickly, and you will have the economic capacity to resume payments. In that case, the Bank will likely give you the option of providing an initial fee (between 30% and 70% of the total amount of the loan). I owe ) and thereby prevent your financing from being canceled.  

3rd STAGE - More than six months of debt

If non-payment exceeds six months, at this point, the Bank will take legal action to enforce the loan guarantee. That is, recover the money they slow you through the seizure of a property.  

The consequences of not paying your mortgage credit usually end in the process of seizure and auction by the Bank.   

At this point, unless you pay off the debt in full plus default interest, the Bank will begin foreclosure proceedings.  

The Bank has already notified me that it will initiate a legal process for non-payment. What do I do?

  • Negotiate the immediate total liquidation of the property through a haircut or discount. To do this, you must have saved at least 70% of the total amount of the initial credit.  
  • Restructuring of the outstanding balance of the mortgage. This option is helpful if the financial problem you stopped paying is temporary and you know that you will recover your economic stability. It is about reaching an agreement with the Bank to settle everything owed plus interest on a specific date.  
  • Restructuring of the total credit. It is specifically about signing a Modifying Agreement in which you will negotiate the conditions of your mortgage loan. Not only the amount owed, but the interest rate, terms, etc. If you reach an agreement with the Bank, the final changes to your original contract will be recorded in writing in the agreement.   
  • Sell ​​the property. If it is already complicated for you to continue paying the credit, you can transfer the debt to another person interested in acquiring the property. You can do this through a Real Estate Purchase Agreement. Eye! Neither Infonavit nor the Bank agrees to transfer the debt. If you found a buyer, you must settle the debt with the Bank or Infonavit before a Notary Public.  
  • Accept dation in payment. That is, return the property and, with that, settle the total remaining balance of the mortgage loan. It is important to note that you will lose the money you have paid for the down payment and the monthly credit payments with this option. 

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