I understand their problem, but honestly they have no choice but to pay what the mortgage co wants from them or risk losing the house. many people think that a creditor is requried to take any and all payments, but the simple fact is that in most places they can demand full payment. We used to take partial payments on pager bills and rent we charged to customers. Then it got to where they were so far behind that we refused to take a partial anymore. We double checked with the state, and they said that ANY creditor can demand payment in full and REFUSE partial payments. Since your friends worked out an agreement for temporary reduced payments, they should have stuck to it, even if it meant giving up something else. if they smoke or drink, they should have cut those out. If they go out to eat, they could skip that and fix meals at home, even the meals for their lunch breaks. Sell one vehicle and share the other one if they had 2 vehicles. cable or satellite tv, cut them OFF. almost anyone can easily find a way to save 500.00 or more a month. My wife and i "have" almost a thousand dollars left over after mandatory bills each month, but before groceries and etc.. Sometimes things crop up and we have just enough to buy groceries. When they do, we pay our bills first, then buy store brand groceries. We had to do this recently due to our 18 month old having 2 hospital stays in 3 months. One stay is now paid for, and the other should be by next month. I personally try to pay off those type expenses immediately rather than pay them off over a long period of time. This way i do not add to my recurring bills, and only have a tough time for a month, rather than constantly adding recurring bills. If i really needed to cut costs due to hard times, i can cancel cell phone and satellite and save 200.00 instantly. Then i can cancel a few other items and get at least 300.00 more. i sincerely hope your friends get this worked out. If they have credit card bills, tell them to skip a payment on those to make the house note THIS time. it will not hurt their credit any more than it already likely is. But if they do skip payments elsewhere, they need to IMMEDIATELY call the creditors and see if they will allow them to skip one payment jsut to catch up. then they should cut ALL non-mandatory expenses.

Thanks for all the responses. Housenewbie-I found out a stop payment on an ACH is different than one on a check. It's either the "amount" or the "vendor". But, after making numerous calls and FINALLY getting to speak with someone in the ACH dept of the bank who actually knew something. Apparently standard practice at my bank is if they try to put though an ach and it is nsf they "hold" it and (on good customers like myself) check the account every couple of days waiting for the $$ to be there. They try it 3 times themselves before they send a rejection back to the mortgage company. So that's why the mortgage company never had a record it it being rejected and me paying it 2x. So-I HAD to do a ach stop payment (over the phone thankfully-not dealing with the branch again) because the bank would have tried a 3rd time and taken the $$$ that was in there-shorting all my other bills for the month with all getting late charged. Or if not enough $$ then try another nsf ($20) before they would reject to the mortgage company who then would've tried 2 more times - so this really would have snowballed. And the ACH person on the phone was nice enough to reverse the 2nd nsf fee I was charged. I got the email from the mortgage company today that my payment was rejected. (But remember, I am already paid so I'm not worrying - much). Also - a revocation can be revoked. (They didn't tell me this at the branch). So-big lesson learned. CAREFULLY check before you hit that "SUBMIT" button RA

Can I assume that you fellows have 3 - 6 months' income set aside in an emergency fund in case some rather urgent and catastrophic, unexpected expense turns up - or you get no income for an extended period, e.g. go on strike? Trouble is - when the investment's set up to be pretty well immediately available, usually the rate of return is low. Not much fun to get 2% on invested emergency money - but be paying 5 - 7% on mortgage. I often don't have emergency funds on hand, but have invested assets more than adequate to use as collateral for a loan in case of emergency - at lower rate of interest, as the loan is fully secured by easily-liquidatable assets, unlike the hassle of repossessing, towing, storing and selling a car used as collateral for a loan to buy it. Canadians not allowed to use registered retirement accounts as collateral for loans - but if one carries a substantial amount in such a fund with that institution, usually they'll set up a loan that's officially unsecured, but at a lower rate than that usually charged on an unsecured loan. When I make such a loan, though, the interest is not deductible. Possible problem - if one gets laid off and goes to make such a loan to tide one over, when the bank asks who is one's employer and hears that there isn't one at present - the loan is more than likely refused. But - a number of my investments are carried by the stockbroker. If I have regular, quality assets of, say, $10,000., the broker will lend me up to $5,000. without question. S/he doesn't care whether I'm employed or not. Careful, though - if my $10,000. asset declines in value to $8,000. and I had borrowed the full eligible amount of $5,000., the broker will call me to ask me for a deposit of at least $1,000. to reduce my loan to $4,000.: by tomorrow, at the latest. More than likely s/he'll ask for $1,500. or so, to add a little cushion in case of further reduction in value. If I can't come up with the required amount, then they must sell some of my asset - which results in a reduction in the amount of the asset underlying the loan. Not a good course: I don't want margin calls for either my clients or myself. Here in Canada, mortgage interest on owner-occupied home is not deductible - but when home is sold for a gain, total amount of gain is tax-free. Interest on money borrowed for non-registered investment is deductible, but on money invested in registered retirement account isn't - as the amount invested is deductible, within limits. Many advisors suggest borrow to invest in retirement account, early in year before deadline, then when tax refund relative to the deduction for the retirement account investment arrives, use it to pay down loan, try to have loan paid off before year end. Good wishes as you attempt to make your money work most effectively for you and yours, ole joyful

"I don't see anything on google about how to deal with the extra days in a month beyond the due date, or with question of balance principal being prorated." The balance is not "pro rated" it is amortized. Each payment goes towards interest for the preceding month, and the remaining portion of the payment goes to reduce the principal. When calculated correctly the payments will result in the principal reaching zero (with some rounding errors) by the last payment. The last payment is often slightly different (often lower) to correct for the rounding errors in all the previous payments. Daily interest is computed by determining what the principle remaining is and dividing by the number of days in the payoff month. This is the pro-rated per day interest expense.