Is Forbearance the Right Choice for Right Now?

To Forbear or Not to Forbear

As a homeowner during this unprecedented time of living with the backlash of COVID-19, you must be wondering whether or not things will get so bad that you’ll face losing your home. That is completely understandable and the key to easing your stress level may lie in gathering information and exploring your options long before you may need to exercise any of them. But things change quickly so you’ll need to make sure you keep up with swiftly changing options offered by your mortgage lender.

Prime Example of How Fast Things Change

Just short of a month, when homeowners sought relief from monthly payments due to their financial uncertainty, mortgage servicers were not offering deferrals that would allow you to miss payments and those missed payments would be tacked on to the end of your mortgage term. At the time, they were only offering forbearance which means that you would be allowed to miss payments, say 3 months for example, but at the end of the 3 month period, you would be required to pay all of the missed payments PLUS interest all at once. While that might sound like an ideal short term solution, how likely is it that you would be able to come up with thousands of dollars to catch up on your payments at the end of the forbearance? That’s the question that you have to ask yourself. No matter how well your intentions are, things happen that might make that an impossibility.

Fastforward in Just 30 Days

According to an article in, now Fannie Mae and Freddie Mac are offering homeowners the option of tacking the missed payments on to the end of the loan or spreading the payments out over a specific period of time. This offers far more hope than having to come up with a lump sum particularly if you have been out of work like millions of others, due to COVID-19 circumstances. With this new option, you would begin to make your regular monthly payments again PLUS the a fraction of the missed payments over a period of months.

A word of caution, whatever route you wish to take please be clear about that with your loan servicer. Many people have called to inquire about the options only to have their loan be put into forbearance unbeknowst to them. To above any miscommunication, if your service has communication portal then use it. That way your request for info will be documented along with their responses.

For a free brochure that you can keep handy, just contact me.

[ninja_forms id=1]