When we are already three months behind our mortgage payments, we tend to panic and then we jump onto dangerous decisions. The thing is, mortgage payment delinquency is always a bad thing, and if this happens to you, you are risking your home over foreclosure. Danger flags, eh?

So what do you do?

Here's what: you can go for

a. loan modification

b. short selling

c. refinancing.

Of these three, financial experts say that loan modification is the best choice.

First, short selling requires that you sell your home for a smaller amount and then you're given a lump sum. This sum may or may not be able to pay off your entire mortgage (usually it cannot) but it would hurt your credit score a lot. Now that's problematic.

Second, refinancing is applying for a new loan, with an entirely new set of interest rates, a principal, and and a new set of deadlines. The bad thing here is that you will not have any say in the new arrangements, unlike loan modifications.

Loan modifications, on the other hand, is the process of readjusting your loan to make it more affordable for you. This is done through an agreement between you and your lender. Meaning, you will have a say on how the new arrangements will go. Not too bad, right? The only important thing for you here is to be religious on the payments as it is lighter now! And you can spend all day knitting custom table banners or whatever it is that you think is fun and worry-free.