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With the Huffington Post reporting a record 2.8 million households threatened by foreclosure in 2009, many homeowners are still facing rough times with the economy. While the housing market is still recovering slowly, there are some steps you can take to protect your family from this crisis.

1. Do you find yourself barely making your mortgage payments? Or maybe the payments are just a little too high for comfort? Look into Obama’s loan modification program called Making Home Affordable to see if you qualify. It’s better to begin the process now rather than wait until you’re more strapped for cash.
2. If you know you cannot make this month’s mortgage payment, don’t give up and talk to your lender. Often lenders will work with you if you are behind on a payment or two. Foreclosures cause lenders to lose money in this economy, and both parties want to prevent this if at all possible.
3. If you’re in an ARM mortgage, rates have been adjusting down recently. But once they begin adjusting up, look into refinancing into a fixed mortgage. Be sure to watch the market for changes in mortgage rates, and keep updated with the current mortgage and economic news.
4. If you are not in danger of foreclosure, and are on time with all your payments, now is a good time to begin scraping for that emergency fund. Families are recommended to save 3-6 months of expenses for their rainy day fund. This way, if a spouse loses a job, you’ll still be able to stay afloat for some time and still make your payments.
5. Lastly, if you cannot afford your home due to a loss of a job or a family disaster, look into selling your home as a short sale. This is a compromise between the Lender and the homeowner, for the bank to agree to a loss from the sale if the house does not appraise for the loan amount.

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