What is mortgage forbearance?
Forbearance is when your mortgage servicer or lender allows you to pause or reduce your mortgage payments for a limited time while you build back your finances. According to the CARES act, Most homeowners can temporarily pause or reduce their mortgage payments if they’re struggling financially.
For most loans, There will be no additional fees, penalties, or additional interest (beyond scheduled amounts) added to your account, and you do not need to submit additional documentation to qualify. You can simply tell your servicer that you have a pandemic-related financial hardship.
Common misconceptions about mortgage forbearance
It really chaps my a** when I hear other real estate professionals talk about forbearance and providing false information. So, I did some research myself. I called around to see what lenders were doing in regards to the CARES forbearance act.
Each loan is different. You need to contact your specific lender or mortgage provider, servicer, and ask them what they offer.
Must be a federally backed mortgage. You need to have a federally backed mortgage and you must have experienced financial hardship because of the word that rhymes with brovid wineteen.
If you meet all the criteria, you may be able to push off your loans anywhere from 3 months to 18 months in some cases if eligible. But, consider 12 months to be your max.
Is Mortgage forbearance a good idea?
I mean it really depends. If you are experiencing hardship and have nowhere else to turn, it could be. It’s definitely something you must discuss with a financial advisor or a mortgage counselor. (linked in description)
It will push your loan out further and it will take you longer to pay off. However, please talk to your lender, financial planner, or mortgage counselor to get advice.
This would be a great time to pause and tell you that I’m not your representation in any way - unless I am. But chances are I’m not yet, but hopefully could be your real estate agent after hooking you up with all this awesome information.
But either way I’d like to take this opportunity to ask you to “like” this video and in exchange I will show you a picture of my … city. I live in Colorado Springs, CO. Isn’t it cool? This is the Olympic Museum downtown Colorado Springs, and I’m always posting pictures on Instagram so here’s my shameless plug to please follow me there. So you have two tasks. Like this video and follow me on Instagram. Link in description.
Now back to forbearance.
Who do I call?
Take a look at your mortgage statement. It’s the statement that you get each month that triggers you pulling out your checkbook or clicking the “make a payment” button online. There should be a phone number you can call to talk to a real person.