Behind on Your Mortgage in SC? Your Options Before Foreclosure

Start With Your Mortgage Servicer

Your servicer is the company you send your monthly payment to. Contacting them early, ideally before you miss a payment, usually gives you the most room to work with. Ask about their loss mitigation options, which commonly include:

• Forbearance: a temporary pause or reduction in payments, usually followed by a plan to repay what was paused.
• Repayment plan: the missed amount spread over a set number of months on top of your regular payment.
• Loan modification: a permanent change to your loan terms, such as the rate, term, or balance structure, to make the payment more manageable.

Which options you qualify for depends on your loan type, your servicer, and your situation. Get everything in writing, keep notes on every call (date, name, what was said), and ask how the servicer handles partial payments before you send one.

If your loan is held by SC Housing, call its loss mitigation department toll-free at 800-476-0412 (Option 5). Its Avoid Foreclosure page also has the form to request a loss mitigation review.

Talk to a Free HUD-Approved Housing Counselor

HUD-approved housing counselors can review your budget, explain your options, and help you communicate with your servicer, often at little or no cost. SC Housing reports that free counselors are available at 17 HUD-approved nonprofit or government agencies across the state.

• Search by ZIP code with the CFPB's housing counselor tool, or use HUD's list of approved agencies.
• Call 888-995-HOPE (4673), a free foreclosure counseling hotline staffed around the clock and listed by SC Housing.
• Call 211, or text Rescue to 211211, to reach the United Way Association of South Carolina for help connecting with legal services.

A note on state assistance programs. South Carolina's pandemic-era SC Homeowner Rescue program spent all of its federal funds, and SC Housing says it is closed and will not reopen. The earlier SC HELP program is also permanently closed. SC Housing warns that any offers claiming to be associated with "SC Homeowner Rescue" are not endorsed or administered by the agency. For current next steps, see the CFPB's Help for Homeowners resources.

How Foreclosure Works in South Carolina

South Carolina uses a judicial foreclosure process. The lender files a lawsuit, and the case goes through the court system. In general terms:

• The lawsuit. The lender files a foreclosure action in circuit court. Many counties refer these cases to a Master-in-Equity, a judge who handles real estate matters such as foreclosures. Counties without one may use a Special Referee, an attorney appointed to serve as judge on the case.
• Your 30-day deadline. You have 30 days to respond to the Summons and Complaint in writing. If you do not, you can be held in default, which means the lender's claims are treated as admitted. Calling the lender or the lender's attorney does not count as a response. Working out a deal with your lender does not stop the case either, so answer in writing even while you negotiate.
• Foreclosure Intervention. South Carolina has a court-created Foreclosure Intervention process that gives eligible homeowners, generally those living in the home as their residence, a chance to discuss settlement options with the lender. Those options can include a loan modification, a short sale, or a deed in lieu of foreclosure. Participating does not guarantee an offer.
• The hearing. The judge establishes the amount owed. If the lender proves its case, the judge sets a date for a public sale. Go to the hearing. It is your chance to tell your side and ask questions.
• Notice of sale. The sale is advertised in a local newspaper once a week for three weeks before it takes place. In many counties, sales are held on the first Monday of the month.
• Staying in the home. As the owner, you can generally stay in your home until it is sold at the foreclosure sale and the Master-in-Equity issues a deed to the buyer.
• Deficiency judgments. If the home sells for less than you owe, the lender may seek a deficiency judgment for the difference, unless it waived that right in writing before the sale. When a deficiency is sought, bidding generally stays open for 30 more days after the sale. A deficiency judgment can be challenged, and a homeowner facing one can generally petition for an appraisal within 30 days after the sale ends.
• Surplus funds. If the home sells for more than the debt, the extra money is called surplus funds, and the court may hold a hearing to decide who is entitled to it. If you move during the case, give the court and the lender's attorney your new address so you can be reached.

The SC Judicial Branch publishes a Master-in-Equity Court FAQ that walks through each step in plain language. Timelines vary by county and by case. Do not ignore court papers. Read them, note every deadline, and talk with a licensed South Carolina attorney.

If your home is in North Carolina, the process is different. Talk with a North Carolina attorney about how it applies to you.

Selling Before the Sale vs. a Short Sale

For some homeowners, selling is the option that makes the most sense. There are two general paths.

A traditional sale before the foreclosure sale. If your home is worth more than you owe, selling may let you pay off the loan, cover your costs, and keep any remaining equity. This takes enough time to list, market, and close before the sale date, which is why starting early matters.

A short sale. If you owe more than the home is worth, your lender may agree to accept less than the full balance. Short sales require lender approval, often take longer, and can raise tax or deficiency questions to review with an attorney or tax professional. If you received SC HELP assistance in the past, that assistance may need to be addressed at closing. SC Housing has a payoff and short sale request process for it.

When a sale may make sense:

• You have equity you want to protect.
• The payment is not sustainable, even with a modification.
• There is enough time before the sale date to market the home properly.

Credit impact varies. In general, a completed foreclosure tends to weigh on credit more heavily than many alternatives, but every situation is different. Ask a housing counselor how each path could affect you.

Red Flags: Foreclosure Rescue Scams

Homeowners under financial stress are frequent targets. The FTC's guidance on mortgage relief scams lists warning signs to know:

• Upfront fees. Under the FTC's Mortgage Assistance Relief Services (MARS) Rule, it is illegal for a company to charge you before it has delivered a written offer of relief from your lender and you have accepted it. Licensed attorneys providing real legal services follow separate rules, including holding fees in a client trust account.
• Being told to stop talking to your lender. You always have the right to contact your lender directly. Companies that tell you otherwise are breaking the law.
• Signing over your deed. Transferring the deed does not transfer the mortgage. You can lose the home and still owe the loan.
• "Sell to us now, buy it back later" offers. The FTC describes rent-to-buy and equity-skimming schemes where the homeowner loses both the home and the equity.
• Pressure to sign a stack of papers fast, or demands to pay only by wire transfer, cashier's check, or a payment app.

Not every unsolicited "we buy houses" offer is a scam. But compare any cash offer with what the home could sell for on the open market, and never sign anything that has not been reviewed. Report suspected fraud at ReportFraud.ftc.gov and to the South Carolina Attorney General.

Bring In the Right Professionals

A licensed South Carolina attorney can review court papers, identify any defenses, help with loss mitigation and settlement, and review any offer you receive. A HUD-approved housing counselor can help with servicer options at little or no cost. These are the people to lean on before you sign anything.

• South Carolina Bar Lawyer Referral Service: 1-800-868-2284. Referred lawyers agree to a 30-minute consultation for no more than $50.
• South Carolina Legal Aid Telephone Intake Service (LATIS): 1-888-346-5592, or 803-744-9430 in the Columbia area, to see if you qualify for free legal services. Income and asset limits apply.

If Selling Is Your Best Option, Talk to Us

If you and your advisors decide selling is the right move, Citadel Cofield can walk you through the numbers, explain what a sale could look like on your timeline, and list and market your home. There is no pressure and no obligation to talk. We cannot stop a foreclosure or promise a price or outcome, but we can help you make a clear, informed decision.

Thinking about buying instead? Read our companion guide, SC Led the Nation in Foreclosure Filings in August. How to Buy a Home You Can Keep.

Sources

• ATTOM, Foreclosure Activity Report by State, August 2026 (PDF)
• SC Housing, Avoid Foreclosure
• SC Housing, SC Homeowner Rescue
• SC Housing, SC HELP
• SC Housing, SC HELP Frequently Asked Questions
• FTC, Mortgage Relief Scams
• CFPB, Find a Housing Counselor
• CFPB, Help for Homeowners
• SC Judicial Branch, FAQ in SC Master-in-Equity Court (PDF)