If you’ve been missing mortgage payments and are facing or about to face foreclosure, a forbearance agreement can help you to stop it. It is an option offered by your bank in order to help you get your payments back on schedule. Your lender may adjust the loan payment terms to make them more manageable for you. Many consumers who fall behind on mortgage payments use this method to help save their house. This type of repayment plan can help you to prevent financial losses and get more breathing room.
Main Advantages of Getting a Mortgage Forbearance Agreement
A loan forbearance is designed to make lenders work with you to avoid foreclosure. It is usually an option for borrowers who are defaulting and have become delinquent with their payments because they have lost their job, sustained medical injuries or have other hardships. You will not have to pay any late fees for the duration of the agreement. In some cases, your lender may even provide you with a grace period where you do not have to make any payments, so you can get back on your feet.
The main advantages of getting a forbearance agreement are:
- You get to save your investment
- You can keep your home
- Your family will continue to have a secure place to live
- Your life as you know it will not have to be disrupted
- You will sustain less damage to your credit rating
What You Should Know Before Signing a Forbearance Agreement
Once you sign a forbearance agreement, it will be used to stop the foreclosure, even if the process has already started. Whether your lender gives you a loan modification, involving extended terms or a lower interest rate, or gives you a limited period to make good on outstanding payments, you should honor the terms of the forbearance arrangement. You must stick to the plan because if you don’t, your lender will restart the foreclosure..