The Covid-19 Coronavirus has led to some challenging times for all of us.
The Government has created the CARES Act to assist homeowners whose income may have been adversely impacted by the coronavirus. One of the components of the CARES Act is the possibility of mortgage forbearance.
Forbearance is often misinterpreted. Many people are mistakenly thinking that forbearance equals forgiveness. It does not. This is truly intended as temporarily relief for those who need it most.
Forbearance means that the payments will be suspended for a short period of time, initially up to 6 months, but will need to be caught up when the forbearance period is over.
Think about when you buy something at a furniture store that offers “no payments” for 3 months. You still must pay for the furniture…the payments are just deferred.
There is absolutely no financial benefit by exercising forbearance, as you will either have to pay a lump sum, modify your loan, or owe the balance when you refinance or sell your home.
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.
Depending on your situation, we may be able to help by offering a refinance to eliminate your debts, lowerer your payment, and/or give you a cash cushion during these turbulent times.