Are you having trouble paying your mortgage? You may need a mortgage forbearance.
With so many employees being laid off or furloughed in the wake of the coronavirus pandemic, homeowners who can’t pay their mortgage are looking at their options. The same goes for renters who can’t cover their rent. Today I’ll shine a light on a few of those options.
The first is mortgage forbearance. Mortgage forbearance is a period where you don’t have to make any mortgage payments. However, it doesn’t mean you won’t owe that money. You’ll still have to pay that amount eventually, so if you can still make your mortgage payments, I recommend doing so.
In many cases, banks move those suspended payments to the end of the life of the mortgage, which means you’ll pay more in interest in the long run. If you’re unsure whether a mortgage forbearance is right for you, just give your lender a call and talk it over with them.
If you don’t see yourself getting back on your feet anytime soon, call me so we can discuss your other options. Many homeowners have lots of equity in their homes, so we can also explore alternatives like selling or renting out your home.
“If you can still make your mortgage payments, I recommend doing so.”
If you’re a renter, the same principle applies: If you can make your payments, go ahead and do so, because that amount due isn’t going away. Some landlords may cut you a break and offer one month of free residency, but in most cases, they need that money to make their mortgage payments or pay their living expenses.
Whether you’re unable to pay rent or have tenants who can’t pay rent, those payments usually have to be repaid within the next six months. If you’re the landlord in this case, work with your tenants to see how they can make their payments. If they absolutely can’t, and you depend on that money to pay your mortgage, talk to your mortgage servicer and explain your situation. They know many people are going through a similar situation, and they’ll be willing to work with you. Your tenants may be able to make their payments once they get back to work, so get creative and find a solution that works best for all.
As always, if you have questions about this or any real estate topic, don’t hesitate to reach out to me. I’m happy to help.