On this page
- What is a mortgage repayment plan?
- Who a mortgage repayment plan fits
- Mortgage repayment plan vs. other loss mitigation options
- What to do first if you are behind on mortgage payments
- What happens at 1, 2, 3 and 4 missed payments
- How a repayment plan affects your credit
- Mortgage repayment plan FAQ
- Your next step
A mortgage repayment plan is an agreement with your mortgage servicer: you pay your regular payment plus an extra amount each month until the missed payments are made up. Your interest rate, balance and loan term stay the same. It is one of several options for a borrower who is behind, and it fits best when your income is back to normal. The first step is to call your servicer and ask what it can offer.
What is a mortgage repayment plan?
A repayment plan for a mortgage brings a past-due loan current over a set number of months. Freddie Mac’s Seller/Servicer Guide (Section 9203.2, effective October 1, 2026) describes it as “paying normal regular payments plus an additional agreed upon amount in repayment of the Delinquency.” When the last plan payment clears, you go back to your regular payment.
The plan comes in writing. Under FHA rules, for example, the agreement must list the months you missed, the past-due total, the plan length and the new monthly amount. It must also say that no late fees apply while you keep to the plan and that you may pay early. Fannie Mae and Freddie Mac likewise bar late charges during the plan as long as you pay as agreed.
How a mortgage repayment plan works: a worked example
Here is a simple illustration. It leaves out late fees, interest and any escrow change.
- Regular monthly payment: $1,000
- Missed payments: 3, so $3,000 is past due
- Six-month plan: $3,000 ÷ 6 = $500 extra per month
- Payment during the plan: $1,000 + $500 = $1,500
- Same $3,000 over 12 months: $250 extra, so $1,250 per month
Your servicer sets the length, and a longer plan is not always allowed. Fannie Mae and Freddie Mac cap the total plan payment at 150% of the regular monthly payment. Freddie Mac counts escrowed taxes and insurance in that payment. In this example, the six-month payment of $1,500 is exactly 150% of $1,000, the most those rules allow. The 12-month payment of $1,250 is 125%, so it leaves more room in your budget.
FHA has its own limits. As of the HUD Handbook 4000.1 update of August 12, 2026, an FHA repayment plan can run up to 24 months. However, the past-due amount generally cannot exceed four months of payments (principal, interest, taxes and insurance), with exceptions up to 12 months in a few cases. Three missed payments fall within that limit, but five or more would usually point an FHA borrower toward a different option.
What a repayment plan does not change
A repayment plan raises your payment for a while; it never lowers it. Your rate and remaining term stay the same, and nothing is added to the back of the loan. Escrow can still move, though, so FHA’s rules say the plan payment may change if your escrow payment changes.
Who a mortgage repayment plan fits
A repayment plan works when the problem is over. Fannie Mae tells servicers to consider one “when the delinquency resulted from a temporary hardship that no longer appears to be a problem.” Freddie Mac says you “must have the financial capacity to bring the Mortgage current.”
In practice, your servicer will look at a few things:
- The hardship has ended. For example, you are back at work after a layoff or recovered from an illness.
- Your income can carry the higher payment. FHA servicers must have you confirm the plan payment is affordable.
- How far behind you are. For Fannie Mae and Freddie Mac loans, a loan 90 days or less past due on a plan of six months or less can be approved without a full application. Past that, the servicer needs a complete application package.
- Your loan type. Each agency and investor sets its own limits, so the number of months a servicer will allow depends on who owns or insures your loan.
No servicer has to approve a particular plan, so if the math does not work, ask what else is available.
Mortgage repayment plan vs. other loss mitigation options
Servicers call these choices mortgage loss mitigation options.
| Option | What happens to the missed payments | What happens to your monthly payment | Best fit |
|---|---|---|---|
| Repayment plan | Paid back over a set number of months | Goes up during the plan, then returns to normal | Hardship is over and you can afford the extra amount |
| Forbearance | Still owed when the forbearance ends | Paused or reduced for a set period | Income is interrupted right now |
| Payment deferral or partial claim | Moved to a separate balance due when you sell, refinance or pay off the loan | Returns to your regular payment | Hardship is over, but a higher payment is not affordable |
| Loan modification | Usually added to the loan balance | Changes for good; often lower, but not always | Income is lower for the long term |
If you want a lower payment through a refinance rather than a workout, see our guide to mortgage relief programs. A home equity line of credit has its own payment rules, covered in what to do when your HELOC comes due.
FHA loans
HUD lists repayment plans, forbearance, a standalone partial claim, a standalone loan modification, a modification combined with a partial claim, and a payment supplement on its FHA loss mitigation page. A partial claim places past-due amounts in an interest-free second lien. A payment supplement uses a partial claim to cover past-due amounts and lower your payment for three years.
Before offering a repayment plan, an FHA servicer must tell you that a permanent option might reduce your payment. If a plan fails, the servicer must review you for the other options before it starts foreclosure. FHA modifications can stretch the term to 480 months, but you can receive only one permanent option in any 24-month period outside a declared disaster.
VA loans
The VA’s help to avoid foreclosure page (updated September 23, 2026) lists special forbearance, a repayment plan, a traditional loan modification, a 30-year modification, a 40-year modification and the VA partial claim. A partial claim requires a three-month trial payment plan first, and servicers have until November 28, 2026, to add it to their systems. At 61 days past due, the VA assigns a loan technician; you can also call one at 877-827-3702.
USDA loans
For USDA guaranteed loans, HB-1-3555 Chapter 18 lists informal repayment agreements, special forbearance and loan modifications. An informal repayment plan is a verbal agreement of three months or less. Servicers may also use a Mortgage Recovery Advance to bring the loan current, and some modifications can extend the term up to 480 months.
Fannie Mae and Freddie Mac loans
Fannie Mae’s loss mitigation page lists forbearance, reinstatement, a repayment plan of up to 12 months, payment deferral and Flex Modification. Freddie Mac’s limit is similar: a plan longer than 12 months needs Freddie Mac’s written approval. A Fannie Mae payment deferral can apply when you are two to six months behind. It moves missed principal and interest to a balance with no interest, due when the loan ends, sells or is refinanced.
Flex Modification, for a long-term hardship, aims to cut principal and interest by 20% and can extend the term up to 480 months. Not every modification reaches that target.
What to do first if you are behind on mortgage payments
Start with these steps, ideally before a second payment is missed:
- Call your servicer. Use the number on your statement and ask for loss mitigation or home retention options.
- Keep a record. Note the date, the person’s name and what you were told. Ask for any offer in writing.
- Gather documents. Have a short hardship letter, recent proof of income and recent bank statements ready.
- Send a complete application. Under Regulation X, a complete application received more than 37 days before a foreclosure sale must be evaluated within 30 days.
- Talk to a HUD-approved housing counselor. HUD says foreclosure prevention counseling is always free. Use the HUD counselor search, call 800-569-4287, or call the Homeowners HOPE Hotline at 888-995-HOPE.
Watch for scams. Under the CFPB’s Regulation O (12 CFR 1015.5), a mortgage relief company cannot collect a fee until you have signed an agreement with your servicer based on an offer the company obtained. Never pay an upfront fee to anyone who promises to stop a foreclosure or change your loan. Your servicer and a HUD-approved counselor will help for free.
What happens at 1, 2, 3 and 4 missed payments
Timelines vary by servicer and by state, but federal rules set a floor.
One missed payment. Most mortgages have a grace period, after which your servicer can charge the late fee your mortgage documents allow. Lenders usually report a late payment to the credit bureaus once it is 30 days past due. By the 36th day, your servicer must try to reach you by phone or in person and tell you about loss mitigation options.
Two missed payments. By the 45th day, your servicer must send a written notice describing loss mitigation options and how to get help. For a VA loan, a VA technician is assigned at 61 days.
Three payments behind on your mortgage. At this point you are about 90 days past due. HUD says many borrowers then get a demand letter giving 30 days to bring the loan current. A repayment plan is still possible. Even so, Fannie Mae and Freddie Mac servicers need a full application once you are more than 90 days behind.
Four or more missed payments. Under 12 CFR 1024.41, a servicer cannot make the first foreclosure notice or filing until the loan is more than 120 days delinquent. If you send a complete application before that filing, the servicer generally must decide on it first. After that, state law sets the steps and timing. These rules apply to your principal residence.
How a repayment plan affects your credit
A repayment plan does not erase late payments that were already reported. Equifax notes that after 30 days, only incorrect late payments can be removed, and accurate ones can stay for up to seven years. Their effect on your scores generally fades with time.
Keeping to the plan does stop new late payments, so ask your servicer how it will report the account during the plan. Our guide on how your credit score affects your mortgage eligibility explains what lenders look at later.
A refinance usually needs a recent run of on-time payments, so plan on waiting after you catch up. See refinancing with a late mortgage payment for more. If a home is lost, buying again is still possible after a waiting period, as covered in buying a house after foreclosure.
Mortgage repayment plan FAQ
How do mortgage repayment plans work?
You pay your regular payment plus a fixed extra amount each month until the past-due balance is gone. The servicer sets the length, up to 12 months for most Fannie Mae and Freddie Mac loans and up to 24 months for FHA loans. Then your payment returns to normal.
What is the difference between a repayment plan and a loan modification?
A repayment plan leaves your loan terms alone and raises your payment for a short time. In contrast, a modification permanently changes the loan, often by adding the past-due amount to the balance and extending the term.
How many missed payments before foreclosure starts?
Federal rules bar the first foreclosure notice or filing until the loan is more than 120 days delinquent, roughly four missed payments. After that, state law controls the timing.
Can I get a repayment plan on an FHA loan?
Yes. As of HUD’s August 2026 handbook, FHA plans can run up to 24 months. Generally, the past-due amount cannot exceed four months of payments, though some exceptions apply.
What if I cannot afford the higher payment?
Tell your servicer, because other options do not raise your payment. A payment deferral or partial claim moves the missed amount to a balance due later, while a modification can lower the payment if your income has dropped for good.
Your next step
A mortgage repayment plan is the simplest fix when a short setback is over and your budget can carry a higher payment for a while. If it cannot, a deferral, partial claim or modification may fit better. Call your servicer this week and ask for loss mitigation options; a free HUD-approved counselor can help.
Once your loan is current again, a refinance may lower your payment for good. Compare rates from several lenders to see what you could qualify for.
