Ask The Money Coach

Q: I am Single and Work One Job. My Mortgage is Upside Down. The Mortgage Company Keeps Tacking on Fees Other Than Late Fees. Is it Legal for a Mortgage Company to Send You a Late Notice and Charge You Even When You Know You’re Late?

A: Yes, a mortgage company can send you late notices and tack on late charges to your mortgage when you don’t pay on time. Unfortunately, those fees can add up, because sometimes they include penalties, added interest, collection costs, and maybe even attorney’s fees if they have to get lawyers involved. It doesn’t sound like you’re at the point of foreclosure, but clearly you are in a very difficult financial predicament. Based on everything else you said to me, it seems that you bought your home in 1990 when you children lived at home, but now they’re gone. You described a roof problem which will take $3,000 to repair, and you also have the added financial burden of having recently taken in 3 of your grandchildren. I think you need to be realistic about your circumstances and consider whether or not you can afford to live in the home you currently have. Chances are, the home is too big for you all by yourself. Also, I recommend that you begin the process of telling your adult children that you can not afford to take care of their children. I admire the love and selflessness that you have shown in taking care of your grandkids, but this entire situation sounds like simply too much. Unless your children are providing significant financial support for you to keep their kids (which I doubt), I think you should unwind that situation and simply tell your family that you are being buried under a mountain of bills. You said that you have a car note, as well as credit card bills, some of which have been sent to collection agencies, so that tells me you are really struggling to keep your head above water. Since you are working, talk also to your mortgage lender and see if they have any options to offer you, such as a forbearance or deferment on your loan, or perhaps a loan modification. Also look into the Obama plan, www.MakingHomeAffordable.gov and see if you qualify for that program. Good luck!

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