A mortgage forbearance is a temporary agreement between a homeowner and their mortgage lender or loan servicer that allows the homeowner to pause or reduce their mortgage payments for a specified period, especially when they are facing financial hardship and are behind on their mortgage. It's a way to provide short-term relief to borrowers who are struggling to make their monthly payments due to circumstances like job loss, medical bills, or other financial challenges.

Key features of a mortgage forbearance include:

1. Temporary Payment Suspension or Reduction: During the forbearance period, the homeowner is either allowed to make reduced payments or no payments at all, depending on the terms of the agreement.
2. Accrued Interest: While the homeowner's monthly payments may be reduced or suspended, interest on the outstanding loan balance continues to accrue during the forbearance period. This means that the homeowner will owe the unpaid interest once the forbearance ends.
3. Length of Forbearance: The length of the forbearance period can vary and is typically agreed upon between the homeowner and the lender. It can range from a few months to up to a year, depending on the circumstances.
4. Repayment Options: At the end of the forbearance period, the homeowner is required to repay the missed payments. There are several ways this can be done:
   • Lump Sum Payment: The homeowner pays the entire forbearance amount in a single lump sum.
   • Repayment Plan: The missed payments are spread out over a specified period and added to the regular monthly payments until the arrears are paid off.
   • Loan Modification: The homeowner and lender may negotiate a permanent change to the mortgage terms to make the payments more manageable, such as extending the loan term or modifying the interest rate.
5. Credit Reporting: Lenders often report mortgage forbearance to credit bureaus. While a forbearance itself does not typically damage credit scores, it can have an impact on future credit applications, as creditors may consider the borrower's payment history and financial circumstances.
   ​

It's important to note that eligibility for a mortgage forbearance and the specific terms of the agreement can vary depending on the lender, the type of mortgage, and the homeowner's individual circumstances. To request a mortgage forbearance, homeowners should contact their lender or loan servicer as soon as they anticipate difficulties making their mortgage payments. Open communication and documentation of the financial hardship are crucial in this process.
Mortgage forbearance can provide temporary relief to homeowners facing financial challenges, but it's essential to understand the terms and consequences of the forbearance agreement fully. Additionally, it's advisable to explore other financial assistance programs or alternatives to manage mortgage debt effectively in the long term.

Speak To A Foreclosure Avoidance Specialist Now

By pressing "Submit & Accept Terms," you expressly consent to receive marketing communications about your inquiry from eXp Realty, The Joel & Kim Team and our agents, at the email address and telephone number you provided, which marketing communications may be delivered via email, telephone, and/or text messages, including using an automatic telephone dialing system and/or an artificial or prerecorded voice. Your consent is not a condition to using any of our services, and you may revoke it at any time by replying "STOP" to any of our texts or by unsubscribing to any of our emails. Message and data rates may apply. By pressing "Submit & Accept Terms," you also confirm that you have read and agree to our Privacy Policy and Terms of Use.