Definition
Early intervention is an attempt by a homeowner to cure a mild delinquency on their mortgage loan.
Analysis
Homeowners do not necessarily have to be behind on their mortgage in order to request early intervention assistance from a housing counselor. Sometimes anticipating a future need may be reason to seek help.
The purpose of early intervention is to correct any situation that could lead to more severe delinquencies on a mortgage loan that could ultimately result in foreclosure. If a lender has sent the How to Avoid Foreclosure booklet, it is a sign that you need to take action soon. Lenders must send this book no later than the second month of delinquency.
A housing counselor can provide default resolution counseling, where they will help provide information on how to correct the situation. The counselor may:
- help you develop a plan to catch up on payments (informal forbearance plan)
- talk with you about refinancing the property
- discuss selling the property
Early intervention is designed to restore the mortgage loan to current status within 90 days. It is structured in a way that could allow the homeowner to recover on their own. Homeowners that need more substantial help may need to discuss loss mitigation options with their housing counselor.
