Mortgage Forbearance – BIG News from FHA (FHA Borrowers) | The Kwak Brothers
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Mortgage Forbearance – BIG News from FHA (FHA Borrowers)

Alright, FHA Borrowers, A BIG change on the Mortgage Forbearance Program. If you or someone you know has an FHA Loan and you’re struggling to make the payments, a new change has been on the mortgage forbearance program. So in this video, I’m going to explain what mortgage forbearance is, what the change is, and how to apply for mortgage forbearance. If you’re struggling to make your mortgage payments right now, you may qualify for mortgage forbearance. Now, what exactly is a mortgage forbearance? Mortgage forbearance is simply a break from making your mortgage payments for a set amount of time. It’s not the same thing as getting forgiveness on the loan – at the end of the day, you still have to make the payments. Now before the pandemic, getting a mortgage forbearance had devastating effects on your credit as well as your future ability to get financing. Typically, you’d have to make a whole entire year’s worth of payments to qualify for new financing. And worse, once you’re out of the forbearance plan, some lenders may demand a lumpsum payment to reinstate the loan back to the original payment schedule. So if you’re struggling right now to make your payments because of a loss of job or income, you have nothing to lose if you choose to take the mortgage forbearance option. And I want to remind you that this currently applies to FHA and other federally backed mortgage programs… If you request a mortgage forbearance, by default, you get up to 6 months of forbearance followed by another 6 months if you request it. That means you may be able to receive up to 12 months of mortgage forbearance if you apply. So here’s the BIG change that was JUST announced by the FHA. According to the original CARES act text, you had until December 31st, 2020 to apply for the mortgage forbearance – which is coming up VERY fast. But just yesterday, the FHA announced that they would be extending the mortgage forbearance application period till February 28th, 2021. So you get two additional months to consider whether you want to take it or not. So how do you apply, well contact your mortgage lender or the loan servicer and ask them you’d like a mortgage forbearance in accordance with the COVID-19 CARES act… From what I read in the CARES act, the lenders do NOT have to request proof or documentations. It’s a simple attestation that you’re struggling and you’re requesting mortgage forbearance! It’s a VERY simple process. Just contact your lenders if you’re struggling with your mortgage payments.