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Mortgage forbearance options and what you need to know before you defer payments

Posted at 10:43 AM, May 01, 2020
and last updated 2020-05-01 10:43:36-04

As homeowners are struggling to pay their bills, many are looking to their mortgage company for some forbearance. As we're finding out, there are some things you need to consider.

"They said they would skip three payments, but then on 8-1, - I would have to send them $4.581.12," said Jan from Chesterfield Township.

"That’s not helping me any especially if, my husband just passed, that’s really not helping me any," said Jan who only wanted to be identified by her first name.

She was hoping to add the 3- month deferment on the back end of her payments so she could catch up.

"The rule isn’t clear now about repayment," said Joe Saul-Sehy.

Financial expert Joe Saul-Sehy says be careful-each mortgage company has different rules.

I think that there are people that think is a bit like the PPP where they’re hearing about businesses getting these forgiven loans that you don’t have to pay back.

Saul-Sehy says one company may add it to the end or as Jan would have to do- pay immediately after the three-month deferment.

"You have to know what you’re getting into beforehand, don’t just say, cool! I don’t have to pay my mortgage for 3 or 4 months," said Saul-Sehy.

He also says thankfully the forbearance does not affect your credit.

"However, and this is the part we’re not hearing about, it will be on your credit report," said Saul-Sehy.

So this could hurt your chance to get a loan in the future. so, the big question, if you can pay, you probably should?

"Absolutely, if you can pay, you really want to," said Saul-Sehy.

What about mortgage refinancing?

"If you’re lucky enough to be healthy and you have a job right now, interest rates are incredibly low," said Saul-Sehy.

SO HERE’S THE REBOUND RUNDOWN

  • ONLY TAKE FORBEARANCE IF YOU MUST
  • UNDERSTAND WHAT YOU OWE AND WHEN
  • CONSIDER REFINANCING-RATES ARE LOW

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