At the beginning of the Pandemic in 2020, homeowners were able to put their mortgages in forbearance. With the number of mortgages in forbearance, at its peak in 2020, being almost 9% of mortgages on forbearance or in delinquency. This figure has decreased substantially, with the most recent figure being under 2.5% of mortgages in forbearance. If you’re in forbearance currently, I’m going to let you know about some of your options in this video.
Introduction: If you’re a homeowner who has been in mortgage forbearance, the end of the forbearance period will require some decision-making. In this blog post, I, Parker McKee, will present three options that may be available to you as you navigate the next steps after mortgage forbearance.
- Request a Forbearance Extension: Contact your mortgage provider to discuss the possibility of extending your mortgage forbearance. Many mortgage companies prefer to avoid foreclosure and the complexities of repossessing and selling a home. Therefore, they may be open to extending the forbearance period. However, keep in mind that an extension is not a permanent solution, so it’s crucial to have a plan in place for when it eventually expires.
- Negotiate a Payment Plan or Adjust Mortgage Terms: Explore the option of negotiating a payment plan or adjusting the terms of your mortgage to address missed payments during forbearance. Some mortgage providers may be willing to modify the terms or establish a repayment plan that allows you to catch up on the missed payments gradually. Another possibility is deferring the missed payments and adding them to the end of your mortgage term. This readjustment can help alleviate immediate financial strain. Note that not all mortgage companies offer these options, and some may require a balloon payment for the full amount due.
- Consider Selling Your Home: While not an ideal choice for most homeowners, selling your home could be an option to avoid the risk of foreclosure. If you were already contemplating selling your home or are in a position to do so, it may be a viable solution. Selling your home enables you to settle any outstanding mortgage obligations and start fresh. Consulting with a real estate professional can provide guidance on the selling process and help you make an informed decision.
Conclusion: As you emerge from mortgage forbearance, it’s essential to assess your options and determine the best course of action for your circumstances. Requesting a forbearance extension, negotiating a payment plan, adjusting mortgage terms, or even selling your home are all potential avenues to consider. Reach out to your mortgage provider to discuss available options and seek professional advice to make an informed decision. If you have any questions or require assistance, don’t hesitate to contact me. I’m here to help you navigate this process.