Help with Mortgage Foreclosures

This website is for borrowers, attorneys, housing counselors, and anyone else who would like to learn more about mortgage foreclosure settlement conferences.

Borrowers in foreclosure cases filed after July 1, 2009, have the legal right to request a settlement conference with the mortgage lender.  The purpose of these settlement conferences is for the borrower and the lender to engage in negotiation and, if possible, come to a mutually-satisfactory “workout” in place of foreclosure.  However, there are a few exceptions to the new settlement conference law, and not all borrowers will qualify (see “Is A Settlement Conference Right For Me?” below).

On this site, you will find information on what a settlement conference is (and what it is not), how to request a settlement conference, what documents are needed in order for the lender to make a decision, what “workout” options are available, and ways to receive assistance through free or low-cost legal services.

How Can I Get Help With Foreclosure or Preparing for a Settlement Conference? Borrowers looking for help with mortgage foreclosures or in preparing for a settlement conference should contact the Indiana Foreclosure Prevention Network (IFPN) at 1-877-GET-HOPE or  The IFPN is made up of state-certified foreclosure prevention counselors who specialize in reviewing homeowners’ financial situations to help determine options to avoid foreclosure.  All services provided by the IFPN are free and confidential.

More videos about mortgage foreclosure settlement conferences

What is a Settlement Conference?

A settlement conference is a face-to-face meeting with your lender’s representative. It is your last chance to work out a deal with your lender before a foreclosure takes place. If a foreclosure does take place, you will lose your home and your credit rating will be damaged. However, a settlement conference is not a guaranteed workout between you and your lender!

Is a Settlement Conference Right for Me?

Settlement conferences are not available to everyone who receives a notice of foreclosure. If the property being foreclosed is a business, or your second home/vacation home, you are not eligible for a settlement conference. In addition, if you already received a loan modification under this statute and have again fallen behind on payments, the lender is not required to attend another settlement conference. However, if the property being foreclosed is your primary residence, and if you have not defaulted on any previous modifications, you should be able to request a settlement conference.

If you would like to remain in your home and/or avoid damage to your credit, you will probably benefit from a settlement conference. Many lenders are willing to work with you to find an option that fits your situation, whether it means extending your repayment period, lowering your interest rate, or refinancing. Even if you cannot afford to stay in your home, the lender may accept a short sale or deed in lieu of foreclosure – this allows you to sell your home at below market value, or give your home back to the lender and walk away, without damaging your credit as much as foreclosure or bankruptcy would.

How Do I Request a Settlement Conference?

If you have received a Notice of Foreclosure from your lender, you have 30 days to request a settlement conference from the court. If you request a settlement conference, it will be scheduled for between 45 to 60 days after the date of the Notice. To request a conference, simply sign and print your name and case number on the “Get Help – Get Hope” Notice you received from your lender, and mail or deliver this Notice to the court. You must also send a signed copy of the Notice to the lender’s attorney.

Important - To prevent a default judgment from being entered against you, you must file a written response with the court within 20 days from the date you received the Notice of Foreclosure, or 23 days if you received the Notice by certified mail.  This written response – or “Answer” – is different from the request for settlement conference. 

If you do not file a written response, even if you request a settlement conference, the plaintiff may obtain a default judgment and foreclose.  If you file a written response but do not request a settlement conference, the court may decide you have given up your right to a settlement conference. 

What if I need more time to prepare for my settlement conference?

If your settlement conference has been scheduled, but you need more time to prepare your documents or meet with a housing counselor or pro bono attorney, you may file a Motion for Continuance with the court.  If this motion is granted, it will give you more time (usually 30 days) to prepare for your settlement conference.

Please read the instructions carefully to ensure you’ve completed all parts of the Motion.

Remember, filing these forms does not automatically give you a continuance.  Also, even if your motion is granted, you may not get the time you requested.

You are encouraged to file these forms as soon as possible.  The time requirement for filing will depend on your Court’s local rules.  Check the rules online or call the Court to check on this.

What Items Do I Need?

In order to for you to be able to show your lender why they can benefit from working with you, there are some things you will need to gather together and bring to your settlement conference. The better prepared you are, the better chance you will have for your lender to work out an agreement that helps you to stay in your home or avoid damage to your credit.

It is important that you gather the following documents together and send them to the lender and file them with the court at least 30 days BEFORE your settlement conference:

Copies of supporting documentation you will need to provide:

  • Most recent bills and statements for all expenses.  Must include one recent utility bill with Borrower(s) name and address
  • Last 60 days of pay stubs for all employment and income sources for all persons over the age of 18 living in the property (for receiving pension or Social Security
  • Disability, please include copy of award letter if available)
  • Last 2 months of all current bank statements (Please include the monthly bank statement that includes the account number and monthly transactions)
  • Last 2 years of tax returns and W-2s/1099s (If you filed electronically, please sign the tax returns)
  • If unemployed, a copy of your unemployment eligibility or an explanation of benefits
  • If self-employed, a copy of your previous year’s filed 1040 tax return
  • If self-employed, 6 months’ current personal and business bank statements
  • If self-employed, most recent quarterly Profit and Loss statement (some lenders may require an audited version)

Hardship Letter. A hardship letter simply explains what has happened that has made you unable to pay your mortgage.  It acts much like an outline or biography of your current “life” issues that are affecting your ability to meet your financial obligations.  It should be short, to the point, and simple—remember that your lender is busy, and an extremely long or detailed letter will not get the attention of an overworked employee.  Usually 1 or 2 pages is more than enough to get your point across.

Here is an example list of hardships that lenders consider during the loan workout process:

  • Adjustable Rate Mortgage Reset
  • Illness
  • Loss of Job
  • Reduced Income
  • Failed Business
  • Job Relocation
  • Death of Spouse or Co-Borrower
  • Incarceration
  • Divorce
  • Marital Separation
  • Military Duty
  • Reduced Income
  • Medical Bills
  • Damage to Property (natural disaster or unnatural)
  • Other (Please Specify)

As you can see, there are many reasons for falling behind on your mortgage.  You may have had more than one of these reasons.  If that is the case, list the main reason first and then the other reasons as well.

Susan's Budget

Income Monthly Amount
Secretary $1,400
Babysitting $100
Total Monthly Income $1,500
Expenses Monthly Amount
Mortgage $320
Car payment $140
Food $350
Electricity $60
Water $20
Gas $200
Telephone $120
Cable/internet $100
Miscellaneous (clothes, kids’ lunch money, medical bills, etc.) $100
Cigarettes $60
Lunch $60
Total Monthly Expenses $1530
(Income – Expenses)

Budget Sheet. A budget sheet is the first step to prove to your lender why they should work with you to find a way for you to afford your mortgage. In order to best explain your current financial situation to your lender, you will need to write out and show on a simple budget sheet how much money you have coming in monthly, and where that money is going.

Example: Susan is employed as a secretary and makes approximately $350.00 per week (or $1,400.00 per month). She has 2 sons, ages 5 and 8. Her mortgage is $320.00 per month, and she spends another $140.00 per month on her car payment. Her electric bill is around $60.00 per month, and her water bill is $20.00. She fills her car up with gas once per week, for about $50.00, and spends between $75.00 and $90.00 per week on groceries. Susan’s cell phone bill is $120.00 per month, and she pays another $100.00 per month for cable and internet. Susan smokes about half a pack per day, for a total of $15.00 per week, and eats fast food for lunch sometimes, spending around $5.00 2 or 3 times per week. Susan also babysits on the weekends for extra money, earning around $100.00 per month.

Susan’s budget sheet would look something like the table at right.

Obviously Susan is spending more than she is earning, which is a problem.  However, there are some ways in which she can cut her unnecessary expenses—and her mortgage lender would expect her to do so.  First, she should quit smoking—this will save her $60.00 per month, as well as decrease future medical bills and health insurance payments.  Susan can also consider bringing her lunch to work—this may increase her grocery bill a bit, but can save her at least $20.00 or $30.00 per month.  Susan can also look into less expensive phone plans—for example, a pay-as-you-go phone—and consider canceling her cable subscription, or at least scaling back to the most basic option.

By simply decreasing some of her unnecessary expenses, Susan can save nearly $200.00 per month, money she can use to put toward her mortgage payment or into a savings account.

When putting together your budget sheet, keep an eye out for unnecessary expenses like cigarettes, eating out, going to the movies, etc.  A mortgage lender will zero in on these kinds of expenses—be ready to explain how you are going to eliminate them from your budget.

Get an Affordability Worksheet to figure out what kind of payment you can afford
Get a Budget Worksheet that you can customize

What Workout Options Are Available To Me?

The main question here is what you want – do you want to stay in your house?  Are you suffering a temporary setback, but believe you are able to make your mortgage payments?  Or do you believe the payments are much too high, and you’d rather walk away from your home?  Knowing whether you want to keep or part with your house is essential in deciding what workout option is best for you.

If you want to keep your home, these are some of your options:

  • Forbearance

    • In a forbearance, the lender suspends or lowers your payments for a specific amount of time, usually 3 months. 
    • This gives you a breather while you get back on your feet – for example, if you were laid off for an extended period of time but recently started a new job. 
    • If you cannot currently afford your payments, and your financial situation is not likely to change anytime soon, forbearance is probably not your best option.
    • Forbearance is not a cure to foreclosure, but it can help you get through a brief rough patch.
  • Loan Modification
    • In a loan modification, the loan is rewritten to terms you can meet
    • Payments are lowered because:
      • Payments are stretched out over more time (for example, changing your 30-year mortgage to a 40-year mortgage);
      • The interest rate is lowered;
      • A combination of both extended payments and lowered interest; OR
      • The total amount of loan is lowered due to house value decrease
  • Repayment
    • Paying off delinquency by making payment plus extra
    • This is done perhaps after someone is back to work after a long period of unemployment

If you do not want to keep your home, these are some of your options:

  • Short Sale

    • Lender allows you to sell the home for less than you owe on it
    • This is often done when what is owed on home is more than it is worth
      • Realtor does market analysis
      • Home is listed by Realtor
      • Often must be listed at full price for 3 to 6 months
      • Home is sold for best offer
      • Difference between amount owed on home and what home is sold for can be viewed as income by the IRS and therefore may be “taxable”
      • However, if you and the lender agree to cancel the amount owed as a condition of the sale, this difference may not be taxable. Either way, it is a good idea to consult a tax professional before going through with a short sale.
  • Deed in Lieu of Foreclosure
    • Giving the home back to the lender; owner is allowed to walk away from the home with permission of the lender.
    • Helps avoid damage to credit caused by foreclosure/bankruptcy

Information courtesy of Indiana Housing and Community Development Authority.

Can I Get An Attorney?

Below is a listing of pro bono resources that may be available to you.  The services listed below are free of charge and available to all borrowers, regardless of income, UNLESS OTHERWISE NOTED.


Legal Line for Northeast Indiana
Held every Tuesday, 5:00 to 7:00 p.m. (except holidays)
Sponsored by Allen County Bar Association and Volunteer Lawyer Program of Northeast Indiana
Information available through the VLP, (260) 407-0917,

Volunteer Lawyer Program of Northeast Indiana - brief advice services
Offered to callers to the VLP, 9:00 a.m. to 4:45 p.m. weekdays
Information available through the VLP, (260) 407-0917,


Putnam County Pro Se Desk
Putnam County volunteer lawyers available to answer brief questions, coordinated by Putnam County Family Court Project
Second Tuesday of every month, 12:00 p.m. to 2:00 p.m., Putnam County Courthouse law library
Information available from Putnam County Family Court Project, (765) 653-5974

IBA Legal Line
Held second Tuesday of every month, 6:00 p.m. to 8:00 p.m.
Call-in staffed by Indianapolis Bar Association volunteers, (317) 269-2000

IBA Legal Advice Hotline
Twenty-minute phone consultation for $35, coordinated by Indianapolis Bar Association
Available 8:30 a.m. to 4:30 p.m. weekdays, (317) 269-2222

IBA Bankruptcy Legal Help Line
Held second and fourth Wednesday of every month, 12:00 p.m. to 1:00 p.m.
Sponsored by Indianapolis Bar Association, (317) 269-1910

Shalom Community Center HELP clinic
Held every Friday, 1:00 p.m. to 4:00 p.m., walk-in clinic, first come, first served
Trinity Episcopal Church Great Hall, 101 S. Grant Street, Bloomington
Staffed by District 10 pro bono volunteer attorneys and law students
For information, call (812) 339-3610.

South Central:

Legal Volunteers of Indiana Judicial District 14 Talk to a Lawyer Call-In
Every third Tuesday of the month, with the exception of January, 4:00 p.m. to 6:00 p.m., for all 7 counties of the District. 
January call-in is on Martin Luther King Day, 10:00 a.m. to 4:00 p.m.
Staffed by volunteers from Legal Volunteers.
For information, call (812) 949-2292.


Whitewater Valley District 9 Pro Bono Commission and Indiana Legal Services talk to a lawyer
Held the last Wednesday of every month, 1:30 p.m. to 3:30 p.m., walk in clinic
Maley Foundation building, 712 E. Main St., Richmond
Staffed by Indiana Legal Services and Whitewater Valley District 9 Pro Bono Commission


Volunteer Lawyer Program of Southwestern Indiana Talk To A Lawyer hotline
Coordinated by Volunteer Lawyer Program of Southwestern Indiana, pro bono district 13 Evansville office, also sponsored by Evansville Bar Association and partly funded by Evansville Bar Foundation
Call-in for all 11 counties in District 13, held first Thursday of every month, 4:30 p.m. to 7:00 p.m.
Walk-in sites in those counties scheduled throughout the year
Information on specific sites and times available through the VLP, (812) 434-4886

Pro se clinic for residents of Vanderburgh County
Second and fourth Friday every month, 2:00 p.m. to 4:30 p.m. Appointment in advance required.
Sponsored by the Volunteer Lawyer Program of Southwestern Indiana, Evansville Bar Association, Vanderburgh County Courts, and Family Court Project
Information available through the VLP, (812) 434-4886

Pro bono attorneys are available to represent you at a settlement conference if your income falls below a certain amount. In general, an applicant is financially eligible for legal assistance from Indiana Legal Services if that person's income is within 125% of the Federal Poverty Guidelines. However, attorneys who received foreclosure prevention training from the Indiana Supreme Court in 2009 are required to take at least one pro bono case; these attorneys are not bound by income restrictions or the Federal Poverty Guidelines.

In certain circumstances, an applicant can be financially eligible for assistance from Indiana Legal Services—one pro bono provider in Indiana—if the applicant is within 200% of the Federal Poverty Guidelines. Eligibility under the 200% income guidelines depends on the applicant's expenses and type of legal problem. See Income Guidelines-200% to review these numbers.

There are other eligibility requirements in addition to income requirements. Some of these rules are:

  • To be eligible, an applicant must not have $3,000 or more in a bank account.
  • The equity in the applicant's home will not make the applicant ineligible, but if the applicant owns another piece of real estate, that might make the applicant ineligible.

Get more information about income eligibility guidelines for legal aid
Find a legal aid (pro bono) provider in your area
Find a housing counselor in your area 

Any questions, comments, or suggestions may be directed to Elizabeth Daulton, Project Manager, at