If you’re behind on your mortgage, or know you’ll be late with your next payment, calling your bank or finance company is the most important thing you can do.

Too many homeowners avoid talking to lenders because they’re scared, embarrassed or figure nothing can be done because they don’t have the money.

That's a big mistake. There are ways to restructure mortgage debt and the sooner you discuss them the better the odds for keeping your home.

Click here to learn more about how to save your home from foreclosure.

August 22

Sen. Charles Schumer urged federal regulators to do more to help homeowners struggling to keep up with subprime mortgage payments. The Democratic senator from New York made his plea in a letter to Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke.

Schumer asked them to support a plan in Congress to provide $100 million to nonprofit housing groups to help subprime borrowers -- who often have some of the most costly, ill-advised loans because of their bad credit scores -- refinance their homes.

Many of those consumers now owe more than their homes are worth, making it virtually impossible for them to get out of adjustable-rate mortgages they can't afford.

Schumer said the $100 million -- which would be contained in a Senate appropriations package -- may not be sufficient. He called on the Bush administration to "come up with quick additional financing."

August 17

So many subprime borrowers have defaulted on their home loans that lenders are imposing tough new standards on loans to anyone with poor credit.

One of the biggest changes we've seen is that borrowers with credit scores of 620 or lower have been virtually cutoff from 100% financing.

That's a dramatic change from the past several years when consumers with credit scores as low as 580 had little trouble obtaining a mortgage with no down payment.

How much will you need? At least 3% to 5% of the purchase price.

Click here to learn how state and local programs are providing low- to moderate-income buyers cash for down payments and closing costs.

August 8

Many debt collection agencies buy bundles of bills that hospitals or credit cards can't collect for only a fraction of the total charges. Others are paid a commission on however much they collect.

As a result, bill collectors can write-down 30% to 50% of your debt and still turn a profit. That's why bluntly asking, "How much do I have to pay to make this go away?" could result in a pleasant surprise.

But before you do that, let our 10 steps for dealing with debt collectors explain how they work and what you can do to get them off your back.

August 7

One of the surest ways to raise your credit score is to pay all of your bills on time.

We know you have a lot going on in your life and bills get misplaced and writing checks is a pain. But you need a system to get every payment to every creditor, before the due date on your statement.

Missing a single payment -- even you gas or electric bill -- will be reported to the credit agencies and can lower your score by 10 to 20 points.

Click here to learn more about our three simple steps to raise your credit score.

August 6

Aegis Mortgage Corp. became the latest subprime lender to stop taking applications and say it can't complete the loans it has approved but not closed.

That means borrowers who were counting on Aegis to buy or refinance a home must scramble to find a new lender.

We think 2/28 and 3/27 loans are the best type of mortgages for most borrowers with poor credit.

Check extensive database of lenders from across the country to find the best rates and lowest fees.

August 1

If you’re spending as much as the average American on car payments you can save some big bucks.

A new study by Experian, one of the three major credit reporting agencies, says the average balance on an auto loan is $15,654 and the average monthly payment is $495. The state with the highest average monthly payment is Texas, a whopping $570.

You can buy or lease a very nice ride for half that much -- and probably save on gas and insurance, too. That’s especially true if you trade a big $30,000 pickup or SUV for a $17,000 mid-size sedan or smaller SUV.

That savings can help you meet rising mortgage payments or begin paying off big balances on your credit cards.

July 23

More than seven out of every 10 subprime mortgages impose pre-payment penalties.

These clauses require borrowers to pay five or six months worth of interest, or a flat fee of $5,000 to $10,000, if they payoff the loan during the first several years.

Borrowers with good credit rarely have to put up with them -- only one in 50 conventional loans have a pre-payment penalty.

They're also a burdensome cost that prevents many subprime borrowers from refinancing or selling their homes when they can't keep up with the rising payments on their adjustable-rate mortgages.

Pre-payment penalties are contributing to the dramatic rise in foreclosures on subprime loans, which has Congress and the Federal Reserve considering whether they should be banned or at least restricted in some way.

Until then, just tell lenders you don't want a pre-payment penalty in your mortgage.

July 20

Surveys suggest a shocking number of homeowners -- as many as one out in three -- don't know if they have a fixed-rate or adjustable-rate home loan.

If you aren't sure, dig out your mortgage papers and check. A big, new bill landing in your mailbox is no way to find out.

This is especially important if you live in a state like California or Nevada, where ARMs account for 40% of all outstanding mortgages, or have a subprime loan, which almost always has adjustable interest rates.

Anyone with an ARM must know when the payments begin rising and by how much. Increases of 10% or 20% are common when these mortgages reset.

Then click here for Interest.com's advice on how to cope with rising mortgage payments.

July 10

Getting a cash avance off your credit card may be easy, but it won't be cheap.

Popping your credit card into an ATM is an incredibly expensive way to get money. In fact, it's cheaper to charge purchases than buy anything with a cash advance because of:

• Hefty transaction fees -- usually 2% to 4% of the amount with a minimum fee of $10 or $20.
• Higher interest rates -- 20% to 25% a year for cards that charge 15% to 17% for purchases.
• No grace period -- interest charges always begin as soon as a cash advance is made.
• Policies that require cardholders to pay off all purchases, even new ones, before paying off cash advances.

July 7

A growing number of utility companies are allowing customers to pay their bills at payday loan stores.

Utilities do that because it's a cheap way to collect payments. Payday lenders see it as a chance to push high-cost loans on consumers at a time they need money to pay essential bills.

"Utilities shouldn't direct customers to pay bills where predatory loans are pitched," says Rick Jurgens, a consumer advocate at the National Consumer Law Center.

But until gas and electric companies find a more responsible way for customers to pay their bills in person, you may have to use a payday loan store. Just don't borrow any money.

Payday lenders make short-term loans at outrageous annual interest rates of 300% and more. When the loans come due, consumers are frequently forced to repay by taking out another loan, putting themselves more deeply into debt.

If you need cash, try Interest.com's alternatives to payday loans instead.

July 6

Legitimate lenders don't require borrowers to pay "processing fees" -- or any other charges -- until a loan is approved and a check is the consumer's hand.

Crooks running advance-fee loan scams do.

They often advertise personal or home equity loans in newspaper classified sections or on Web sites, enticing consumers with lower interest rates, higher loan limits and quicker approvals than other lenders.

Banks and finance companies usually deduct their fees from the check borrowers are given after a loan is approved. Con artists tell borrowers they must pay several hundred dollars in fees before the loan is made. Once the scammers have that money, they stop returning phone calls and disappear.

Click here to see Interest.com's 6 smart moves to avoid predatory lenders.

July 4

"2/28" and "3/27" loans are a good way for consumers with poor credit to buy or refinance a home.

These mortgages are a much safer alternative to the dangerous option ARMs or "1% mortgages" lenders have pushed on subprime borrowers over the past several years.

They also offer realistic rates and terms that don't unduly punish borrowers for credit scores in the low 600s, or even the 500s. Indeed, 2/28 and 3/27 loans have a lot in common with conventional three- and five-year ARMs that borrowers with good credit often use.

Click here to learn whether 2/28 and 3/27 mortgages are right for you.

July 3

Virtually all of the Web sites promoting "free credit reports" only provide those loan and payment histories if you buy your credit score.

The most egregious of these misleading sites is freecreditreport.com, which is owned by Experian, one of the three major credit reporting agencies.

In August 2005 it paid the Federal Trade Commission a $950,000 to settle allegations of deceptive advertising. Then it paid another $300,000 in February after being accused of new violations that broke the terms of its initial settlement.

Freecreditreport.com charges $14.95 for an Experian credit report and credit score based on that history. Reports and scores from all three credit reporting agencies cost $39.95.

Annualcreditreport.com is the site the credit agencies established to comply with the federal law that requires them to give consumers one free history a year.

Since the law doesn’t require the agencies to include your credit score, they don’t.

Click here to find out more about your rights and what to do once you’ve gotten a free credit report.

June 26

A non-profit mortgage broker and advocacy group has launched a $1 billion campaign to help the victims of predatory loans refinance their mortgages and save their homes.

The Neighborhood Assistance Corp. of America will use money from Citigroup and Bank of America Corp., to bailout subprime borrowers who were given loans they can’t afford and can’t get out of because they owe more than their homes are worth.

NACA will offer financial counseling and process the applications for 30-year loans at a fixed, below-market rate of 5.5% a year. There are no fees and the banks pay all the closing costs.

Click here to apply for an NACA loan to refinance your home.

Have questions about your finances? Ask us at editors@interest.com