Create a Financial Crisis Plan

Review your income and expenses to set up a spending plan based on a realistic view of your financial situation. Using this information, create a financial crisis plan that helps you cut expenses so you have money to pay the mortgage.

These worksheets can help:

• Identifying Income Worksheet

• Tracking Your Expenses Worksheet

• Comparing Income and Expenses Worksheet

• Set Priorities and Make Changes Worksheet

Budget enough money for health care and housing because they’re your top priorities, in that order. Then, be ruthless about eliminating optional expenses such as cable TV, club memberships, subscriptions, or season tickets.

If you have to make a choice between paying credit cards and the mortgage, pay your mortgage.

If you have other creditors, gather up your bills and call them. Many will agree to work out payment plans with you. You keep more of your money longer — savings that can go toward paying your mortgage.

Other ideas to raise money for the loan:

• sell off assets, like a second car, jewelry, stocks, or a whole-life insurance policy

• get an extra job

• rent part of your home to a boarder

Even if these actions don’t make enough money to pay your mortgage, they show your lender that you’ll make sacrifices to stay in your home. That may persuade your lender to cut you some slack.

Once you set up a crisis budget, ask a trusted family member or friend to hold you to it. That can keep you from making emotional or impulsive spending decisions.