If you or a loved one are experiencing financial hardship on top of buying or paying off the ownership of a home, you are likely experiencing high levels of stress and may be seeking financial guidance during this time. Forbearance plans allow homeowners to make reduced mortgage payments during the term of the agreement while they try and regain a stable financial position. If you do end up utilizing a forbearance plan, you will eventually have to pay off any amount of money that was not paid during the agreement; however, there are several options available for when you are ready to do so. Here, the experienced bankruptcy attorneys at Grossbart, Portney & Rosenberg, P.A. discuss your options when it comes to repaying missed amounts on a forbearance plan, especially if you cannot afford to pay it all at once.
Reinstatement & Repayment Plans
If you are financially able, paying the entire repayment amount at once is the primary option, also known as reinstatement. If you choose to follow through with this option, you must speak with your servicing company about your decision at the end of your forbearance plan. A second option would be to draft up a repayment plan. This plan allows you to repay the forbearance amount on your mortgage over a certain period of time through monthly payments. These payments would also be made in conjunction with your current monthly mortgage payments. If you are considering a repayment plan, it would be greatly beneficial to discuss your decision with a mortgage litigation attorney to ensure that it is the best option for you.
Loan Modification & Refinancing
Another available option is to indefinitely change the terms and conditions of your original loan. This process is known as loan modification. Some changes that can be made to your original loan include modifying the term period or the interest rate, any modifications are made with the intent of making your payments more feasible and less stressful. Typically, this option requires an initial trial period to ensure that after a few months, you are still able to make the new payment amounts each month. However, if successful, this option can result in lower monthly payments. Additionally, if you have already settled or are in the process of settling your forbearance plan, you may have the option of refinancing. In order to determine your eligibility and ensure that this is the appropriate option for you, speak with your mortgage litigation attorney to discuss in further detail.
COVID-19 Payment Options
A final option that may bring many benefits to those experiencing hardships due to COVID-19 is a payment deferral. A COVID-19 payment deferral can allow you to postpone the repayment of your forbearance amount without changing the original terms and conditions of your mortgage, unlike a loan modification. The repayments will be due at the maturity of the mortgage or whenever you may choose to sell your home, leave the property, or refinance the mortgage loan, all with no charge of interest. This option, however, is only available if you cannot afford either a reinstatement or repayment plan.
Seek the Assistance of Mortgage Litigation Attorney
If you are considering the forbearance process, it is essential that you consult with a mortgage attorney to ensure that you are utilizing the best payment option for you and your financial situation. At Grossbart, Portney, & Rosenberg, we are committed to providing you with a personalized consultation service and helping guide you through the forbearance process. To speak with one of our distinguished and experienced mortgage litigation attorneys or learn more about forbearance payment options, contact our Baltimore office today.