Mortgage lenders read your credit reports like a script that tells them exactly how likely you are to go into foreclosure.

Investors who buy cheap properties at the foreclosure auctions know their role well.

If you’re drawn into a foreclosure drama, you don’t want to be the only person in the play who doesn’t know his or her lines.

Try this one, with feeling:

“I’m having financial difficulty and might not be able to make my mortgage payments.”

Industry experts, including those who’ve successfully avoided foreclosure, say those are the magic words to tell your lender if you’re about to fall behind.

Just ask Raul Garcia.

He fell behind on his payments after he was laid off last year as a supervisor in the transportation department at Parkland Memorial Hospital. He collected unemployment benefits, but they weren’t enough to cover his $840 monthly mortgage payment. Compounding the financial stress was the birth of his daughter, Celine, who’s now 8 months old.

“I called the mortgage company and told them I would not be able to make the payment until I could find a new job,” said Garcia, 51, who lives in Mesquite, Texas. He also sought help from Consumer Credit Counseling Service of Greater Dallas.

Originally, the mortgage company was willing to work with him, Garcia said. But then he was informed that his loan was sold to another company.

“I tried to work with the new mortgage company, but they seemed to be uncooperative, unfriendly and not willing to work with me,” Garcia said. “They started sending me foreclosure letters.”

He contacted his credit counselor.

“My counselor called the mortgage company while I was in her office,” Mr. Garcia said. “After my counselor talked with the mortgage company, they seemed friendly and very cooperative. They were now willing to work with me.”

Garcia, who’s now a manager trainee at a fast-food restaurant in Plano, Texas, got a loan modification.

“The money we got behind on was added to the loan,” he said. “Once I’m up to date, I’ll be able to refinance through HUD (the U.S. Department of Housing and Urban Development) with a lower interest rate, but I’ll have to be up to date with payments after that.”

Garcia’s advice for anyone in his shoes:

“Always keep in touch with the mortgage company,” he said. “Let them know right away, the first day.”

Foreclosure doesn’t have to be a foregone conclusion because lenders don’t want your house back if they can avoid it.

“It doesn’t do anyone good to foreclose on a borrower because the lender loses money, Fannie Mae loses money, so it’s in the stakeholders’ interest to keep the borrower in the home as long as possible,” said Sandra Cutts, a spokeswoman for Fannie Mae, the giant mortgage finance company that buys home loans from lenders. “The vast majority of borrowers can be helped, but the key is early intervention.”

Working with a lender can mean the difference between losing your home and keeping it.

“We found that repayment plans lower the probability of home loss by 80 percent among all borrowers and by 68 percent among low- to moderate-income borrowers,” said Amy Crews Cutts (who’s not related to Sandra Cutts), deputy chief economist at Freddie Mac, Fannie Mae’s competitor. “For borrowers, foreclosure alternatives help them keep their homes and avoid the trauma and financial hardships of losing a home.”

HOMELOANS-TIPS

AP-NY-09-13-04 1226EDT