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Mortgage Forbearance End Date – What Now?

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Did you enter into a mortgage forbearance plan? Most likely your time is almost up, if not already.
So what now?

Today we’re talking about 4 possible repayment options and more importantly, 4 major reasons why the chances are very high that you will Not lose your home.

First let’s talk about when these forbearance plans are proposed to end.
Under the CARES Act, homeowners with conventional, FHA, VA, or USDA loans could request an initial loan forbearance for up to six months. They could also request a six-month extension, for up to one year of total forbearance.
Forbearance plans are based on when you requested them.
For example: If you have a conventional loan and on 4-1-2020 you requested a forbearance and also requested an extension. Then your forbearance time would have expired 4-1-2021.

Remember, you’ll have to have a plan in place to repay the payments you missed during this time.
If you are still experiencing hardships due to Covid, here’s the good news:
Recently Fannie Mae, Freddie Mac and feds have given homeowners an opportunity to extend one more time for conventional loans and 2 more times for government backed loans.
Homeowners with conventional loans can request one additional 3-month extension, for 15 months total loan forbearance. To be eligible, you need to have been in a COVID-19 forbearance plan prior to February 28, 2021

Homeowners with government-backed loans (FHA, VA, USDA) can request two additional 3-month extensions, for up to 18 months total forbearance.
But To be eligible, you need to have been in a forbearance plan prior to June 30, 2020.

So, depending on the type of mortgage you have, you may be eligible for 15-18 months of loan forbearance when all is said and done.
It’s important to know that these extensions are not automatic, AND the final decision to grant these extensions are up to your individual mortgage servicers. Help is only available if you ask for it.
What happens when forbearance ends?

When you’re ready to start making payments again, you’ll need a plan in place to repay the payments you missed in addition to your regular payments.
Remember: Loan Forbearance is not loan forgiveness.
Here are a few options:
Full repayment, which is a one-time lump sum payment.
If you are in the position to do so, this is the best option. But here’s what most people do not know: Lenders are NOT allowed to require this. If you can’t repay in one lump sum, there are other options.
Intermittent payments.
This is where you make a payments arrangement with your mortgage servicer to repay the missed payments over a 3, 6, 9 or 12 month period. Again, this is in addition to your regular payments.
Payment deferral.
This option lets you pay off the missed amount when the home is sold, refinanced, or at the end of the loan term.
Loan modification.
This may be an option , and in my opinion the last option and may help you if you’re at risk for foreclosure.
Modification could include a change in your mortgage terms – usually including a lower interest rate, reduced length of the loan, or reduced monthly payment.
There most likely will be another option that our current president will implement as well. I have mixed thoughts about this proposed plan..But enough said about that...For now.
When your forbearance plan ends, it’s important to discuss all your options with your mortgage servicer to determine which exit plan best works for you and you which you are eligible for.
And by the way, you don’t have to wait until your plan ends to exit the forbearance period. You can exit anytime during the plan period..Just make sure you’re ready with a repayment plan.
Also, here’s a couple of tips:
Because the mortgage servicers customer service reps are quite busy these days, it may take you more than one attempt to get through.
Be patient, and don’t give up. They want to help you! The best times to call is first thing in the morning or at the very end of the day. Check your mortgage servicers call hours.
Keep a close eye on your credit score. The Cares Act states your credit score cannot be impacted by late or missing payments if you are in a forbearance plan.
But mistakes happen. Lenders have never had to deal with forbearance plans on this huge scale before. It’s your responsibility to keep an eye on your credit to make sure you didn’t slip through the cracks.
What happens if you still cannot pay even after the forbearance extensions and exit plans?

This is the worst case scenario, but again you still have options!
If you are at this point, you will need to dispose of the house to preserve your credit and maintain the ability to purchase again in the future.
The good news is: Because of the rising home values, chances are very high that you have equity. You could sell your house and perhaps still walk away with a nice profit.

Refinancing your mortgage maybe an option too. However, you must meet the regular requirements as you did when you first bought your home. Your mortgage lender can best advise you if you could qualify, based on your individual situation.

Lastly, Foreclosure, short sale, and deed-in-lieu are other ways of disposing of a home you can’t afford it.
Which brings me to the 4 major reasons why most homeowners will NOT lose their homes to foreclosure:
For starters, the number of homeowners who entered into a forbearance plan vs those who have already exited is nearly 50%! That’s a huge percentage..Which tells me the earlier reports made by others of us seeing a foreclosure wave was a bit off.
Here are the published facts according to the MBA (Mortgage Bankers Association) as of 3-28-2021:
.Almost 50% Leave Forbearance Already Caught Up on Payments

26.6% made their monthly payments during their forbearance period
14.7% brought past due payments current
7.6% paid off their loan in full
Now , there is still 2 million households in forbearance plans. But with all the great options available, these numbers are very encouraging!
Here’s one of the biggest reasons why most homeowners will avoid forclosure:
Banks Do Not Want your home back!
They learned hard lessons from the crash of 2008. They don’t want the headaches of managing foreclosed properties on their books. This time it way different. They have systems to help you stay in your home. They Want to help and have trained staff with this mindset.
And it’s working! A recent report from the MBA reveals that out of all the homeowners who left forbearance:
35.5% have worked out a repayment plan with their lender
26.5% were granted a loan deferral where a borrower does not have to pay the lender interest or principal on a loan for an agreed-to period of time
9% were given a loan modification
These positive percentages are indicators the banks are being successful in their mission to wanting to help homeowners stay I their homes!
Next, There Is No Political Will to Foreclose on households

As I mentioned earlier, the government most likely will step in with another plan

The Consumer Financial Protection Bureau (CFPB) is proposing a new set of guidelines to ensure people will be able to keep their homes. Some major points in the proposal are:
The proposed rule would provide a special pre-foreclosure review period that would generally prohibit servicers from starting foreclosure until after December 31, 2021.
The proposed rule would permit servicers to offer certain streamlined loan modification options to borrowers with COVID-19-related hardships based on the evaluation of an incomplete application.
The proposal rule wants temporary changes to certain required servicer communications to make sure borrowers receive key information about their options at the appropriate time.
None of this is set in stone yet. The question is still up in air whether the CFPB even has the power to delay foreclosures.
If you’d like to read the entire report, and watching this on my YouTube channel, I put the link in the description for you.
And if all else fails, and you have to sell. There’s never been a better time than now!

Home prices are still rising, demand is off the charts and inventory is historically low.  9 out 10 homeowners have more than 10% equity. That’s phenomenal! AND is plenty to cover selling costs, plus walk away with a profit! As a home seller, you are in the drivers seat!
All this being said, the  likelihood of us having a foreclosure crisis again is about zero percent.

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My experience while purchasing my first home was the best experience I've ever experienced. With Lisa's guidance it was a stress free experience. She made sure I was comfortable and understood every step. She gave her opinion from the heart. You can tell she genuinely wanted you to have the home you desired. She is very personable and that's great when you are purchasing a large investment. I am forever grateful of her help. So if you are looking to have a wonderful experience while purchasing or selling any property Lisa Kelly Realtor is the way to go.

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Candace Engram ????? 18 weeks ago My experience while purchasing my first home was the best experience I've ever experienced. With Lisa's guidance it was a stress free experience. She made sure I was comfortable and understood every step. She gave her opinion from the heart. You can tell she genuinely wanted you to have the home you desired. She is very personable and that's great when you are purchasing a large investment. I am forever grateful of her help. So if you are looking to have a wonderful experience while purchasing or selling any property Lisa Kelly Realtor is the way to go.

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I had such a positive experience working with Lisa. Not only is she a complete professional, but such a compassionate human being. Her knowledge guiding me through the Florida real estate process was so helpful as a first-time Florida homebuyer. She was always prompt and responsive while going above and beyond. She attended all key inspections in person and kept me informed throughout the entire process. If you are looking for a great real estate experience, look no further. Lisa is your gal to get the job done. I will definitely be working with her again in the future.

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Kim Manske ?????Aug 21, 2020 We can’t say enough good things about Lisa Kelly! From the moment she stepped through our front door, she demonstrated all the characteristics you want in your realtor: integrity, friendliness, optimism, thorough knowledge of her field, state-of-the-art technical savvy, unflagging energy and sensitivity to all our own needs and feelings. Our house sold in four days and we are certain this success was largely due to Lisa’s skill and hard work. We highly recommend Lisa Kelly to anyone looking for a top notch realtor!

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We had been looking for a new home for about three months. We changed Realtors and began working with Lisa. She showed us a couple of places. We talked about limits on price and location. We looked again on a couple. We did not care for those. She emailed us about a home that was being restored for a flip. We met her at our current home. We liked the location and made an offer which was accepted. She did a great job getting the seller to accept and a wonderful job from there. The closing took about fifteen minutes. We have been very happy from that day on. Patricia and Bill Crabb

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Just wanted to thank Lisa for a job well done. I worked with Lisa on 2 of our homes this past year. We sold one in June and another late in the year. Everything went smooth and all details were handled in a very professional manor. Thanks again Lisa; nice working with you. Lee Brown

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Highly likely to recommend 10/27/2014 - jessbparker Bought a Single Family home in 2014 for approximately $75K in Auburndale, FL. Local knowledge: Process expertise: Responsiveness: Negotiation skills: I cannot say enough about Lisa Kelly. She helped my husband and I buy our first home when we had limited funds and difficult circumstances. She is extremely knowledgeable about homes, market, taxes- anything you could want to know. She is also an excellent advocate for her clients during negotiations, which really came in handy when you're a nervous first-time home buyer.Less

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Highly likely to recommend 02/25/2012 - user027478 Bought and sold a Single Family home in 2011 for approximately $275K in Lakeland, FL. Local knowledge: Process expertise: Responsiveness: Negotiation skills: Lisa is the most professional realtor I've ever worked with... she's direct, honest, highly-knowledgable, very responsive and a consummate professional. She played fundamentally important roles in helping us to sell our house in a tough market. She's a hard worker and also gave us great advice and we were able to sell after listing for about 30 days. She then helped us find and close on our dream home. Her persistance and negotiating savvy helped us buy a house that was not a very convential listing. If we'd had an average realtor, we'd have been a lot less successful with both our deals. I'd recommend Lisa to anyone who wants to work with a genuine professional. She could write a book on what it takes to be an outstanding service provider.

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02/09/2012 - Alyson7707 Bought a Single Family home in 2009 for approximately $125K in Bartow, FL. Local knowledge: Process expertise: Responsiveness: Negotiation skills: We absolutely loved our experience with Lisa.. She is incredibly knowledgeable and dedicated to finding the home of your dreams. We couldn't be happier with the home she found us or the time we spent with her--she made the experience exciting and easy. We do not hesitate to recommend her to friends and family and will absolutely work with her in the future. Thanks again Lisa! -Michael & Alyson Elrod

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Highly likely to recommend 02/08/2012 - AimeeWeed Bought a Single Family home in 2010 for approximately $100K in Auburndale, FL. Local knowledge: Process expertise: Responsiveness: Negotiation skills: Lisa was always quick to respond to my questions. I honestly think that my family and I would not be in this wonderful house without her hard work. She is honest, not afraid to give her opinion in a helpful way, and she is very knowledgeable in all aspects of her job.

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Highly likely to recommend 03/09/2011 - reedswife11 Bought and sold a Single Family home in 2011 for approximately $75K in Lakeland, FL. Local knowledge: Process expertise: Responsiveness: Negotiation skills: This woman is amazing, we have run into every road block imaginable and she has negotiated our problems quickly and effectivly everytime. Always available and Always puts her clients first

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