There’s no question that times are a little bit rough right now between a job market that seems unstable and soaring inflation. It’s not unusual for homeowners to be feeling some financial strain when it comes to meeting their mortgage obligations.
Is a mortgage forbearance an option that can help you get back on your feet? Mortgage forbearance is an agreement between you and your mortgage lender that allows you to either temporarily reduce your mortgage payments – or even put them entirely on pause until you can regain your financial footing.
Does mortgage forbearance make sense for you?
Homeowners who are at risk of falling behind on their mortgage payments can get some much-needed relief with a forbearance, but it only makes sense in some situations. These include when:
- There is a sudden emergency or natural disaster: In the aftermath of a major storm, a flood, an earthquake or some other unexpected disaster, you may be dealing with significant property damage and recovery efforts, even if your home is intact. Forbearance can give you time to recover and take care of things that may not be covered by insurance.
- An unexpected bill comes due: Sometimes life gets unexpectedly expensive. You may have a one-time expense that leaves you financially “tapped out” for a little while, like a hospital bill or a major household repair. Mortgage forbearance may give you just the space you need to regain your financial footing.
- You know your financial setback is temporary: Maybe you are going to miss work due to surgery or you’re going on maternity leave early. Whatever the situation, you’re certain that you’ll regain solid financial ground relatively soon.
It’s important to realize that forbearance doesn’t eliminate those missed payments. It just tacks them on to the end of the loan or spreads them out over time. While mortgage forbearance can offer you a chance to keep your mortgage out of default, it isn’t the right option for everyone. It may be wise to consider legal guidance so that you can fully explore your options, including bankruptcy relief.
