Homeowners who are facing foreclosure and need to get their loan modified will often get a mortgage forbearance.
A mortgage forbearance is a temporary break from making payments on your mortgage, which can help you avoid foreclosure. It's also an option for people who have already been foreclosed on and are trying to sell their home before it goes into foreclosure.
The general idea of a mortgage forbearance is that you'll stop making payments as long as the lender agrees to allow it. If you're in financial trouble and can't afford to make payments on your loan, a forbearance could be helpful—but it's important that you know what you're getting into before agreeing to take one out.
Why Do I Need a Mortgage Forbearance?
There are many reasons why someone might want to ask for a forbearance: they may have missed some payments due to unemployment or other circumstances; they may have been ill; or they may have lost their job or been otherwise unable to make regular payments. Whatever the reason, if you're struggling with your housing costs and need time away from the stress of paying off your home loan, consider getting one of these options instead of losing everything by defaulting.
How Can I Get a Mortgage Forbearance?
Here's how you can go about getting mortgage forbearance:
- Get in touch with your mortgage servicer: Your mortgage servicer is the company that you send your monthly payments to. You'll need to contact them and ask about the process for getting a mortgage forbearance. Their contact information is available online or on your mortgage statement.
- Explain the situation at hand: You'll need to explain to your mortgage servicer why you're having difficulty making your payments. This could include job loss, illness, or other unexpected financial hardship.
- Provide documentation: You may be requested to submit supporting evidence for your request for a mortgage forbearance. This may be financial documentation, bank statements, or medical records.
- Agree to the terms: Your mortgage servicer will provide you the details of the arrangement if they accept your request. This will typically include the length of the forbearance period, the amount of the reduced or suspended payments, and any fees or interest that will accrue during the forbearance period.
- Follow up: It's important to stay in contact with your mortgage servicer during the forbearance period. Make sure you understand of the terms of the agreement and what has to be done to restart normal mortgage payments when the forbearance period is over.
Keep in mind that a forbearance is only a temporary suspension of your payments; it is not an act of forgiveness. You'll still be required to make up the missing payments, either by extending the mortgage's term to include them, paying them off gradually over time, or refinancing the loan. Before making any decisions, be sure to thoroughly weigh your alternatives and speak with a financial advisor.
If mortgage forbearance isn't an option, check out other solutions from our housing solutions page. Family Solutions Foundation also offers free grants to eligible applicants. Absolutely no obligations. You may apply for a free grant here.
