Should You Consider Forbearance?
The coronavirus has thrown us all a curveball, and we know many homeowners are worried about how they will make their mortgage payments. Many mortgage providers have offered to suspend monthly mortgage payments. While saving hundreds or thousands a month may sound like a win, there’s more to consider.
The Government-created CARES Act offers the possibility of mortgage forbearance. Forbearance is when your mortgage servicer or lender allows you to temporarily pay your mortgage at a lower payment or pause paying your mortgage. You will have to pay the payment reduction or the paused payments back later.
Some mistakenly think that forbearance equals forgiveness. It does not. While you may get a temporary reprieve, you may owe a big bill that comes due all at once. For example, if your servicer allowed you to not pay your mortgage for six months, at the end of the forbearance period, you may owe ALL six of your missed mortgage payments in one month.
Forbearance is truly intended as temporarily relief for those who need it most. If you really need to exercise forbearance, you cannot just decide to stop making payments. You must notify your Mortgage Servicer and agree to the forbearance terms.
There are other ways you can minimize debt during this unprecedented time. Depending on your situation, we may be able to help by eliminating your debts, lowering your payment, and giving you a cash cushion during these turbulent times. Please contact us to see if we can help with your mortgage.
We’ve compiled below a collection of resource links for our friends and family that may offer reprieve during this time of need.
- Check out the expanded unemployment benefits for those laid off and for independent self-employed workers
- Learn more about the traditional and expanded relief for small businesses.
- Access resources for families and people in need including services like food and shelter.
- Get information and resources on how to handle student loans
- Find low interest loans to help businesses and homeowners recover from declared disasters
- Ask for an extension on filing your taxes, which are now due on July 15, 2020.
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