What to do after you receive forbearance
While you're in forbearance, it is important to monitor your loan and be ready to act when the end of the forbearance period nears. Contact your servicer in order to extend your forbearance or develop a plan to repay your missed payments.
What to do after you enter forbearance
This advice applies to both a CARES Act forbearance and other mortgage relief that you might receive.
- Stop or change auto-payments for your mortgage. If you are having your mortgage payment deducted automatically from your bank account, make sure you make any necessary adjustment to avoid any fees or charges.
- Pay attention to your monthly mortgage statement. Continue monitoring your monthly mortgage statements to make sure you don’t see any errors.
- Keep an eye on your credit. It’s a good idea to routinely check your credit reports in order to make sure there are no errors or inaccuracies. You can check them weekly for free through April 2021. Servicers may report that your account is in forbearance. However, if you were otherwise current on your account and have received relief as defined by the CARES Act, your servicer or creditor is required to report your account as current. If you stop making mortgage payments without a forbearance agreement, the servicer will report this information to the credit reporting companies, and it can have a lasting negative impact on your credit history. If an error has been made, however, you can work to dispute it.
Get more information about how to protect your credit during the coronavirus pandemic.
- Your property taxes and insurance should continue to be paid by your servicer if your mortgage has an escrow account, but you may want to confirm that with your servicer. If your mortgage does not have an escrow account, you will be responsible for paying property taxes and insurance payments. You are responsible for making any HOA and condo fees during forbearance. There may be an escrow shortage when you leave forbearance. Discuss with your servicer your potential options.
Contact your servicer if you need a forbearance extension
Under the CARES Act, you have a right to a forbearance extension for up to an additional 180 days if you have a federally or GSE-backed mortgage (for a total of up to 360 days). You must contact your servicer in order to receive the extension.
If you are not in a loan covered under the CARES Act, or are not sure, you may also be able to extend your forbearance. Many servicers are offering the same mortgage relief options to all homeowners. Take the next step and talk to your mortgage servicer or a HUD-approved housing counselor.
How to repay your forbearance
Before your forbearance period ends, you will have to make arrangements with your servicer to repay any amount suspended or paused.
Homeowners who receive a forbearance under the CARES Act are not required to repay their skipped payments in a lump sum once the forbearance period ends.
Generally, there are a few different ways borrowers can make up their missed payments. However, the method of repayment varies depending on your loan and the protection provided. Not all borrowers will be eligible for all options. Ask your servicer about what options are available to you.
- A repayment plan might be right for you if you can afford to pay more than your regular mortgage payment for a few months until your missed payments have been made up.
- A deferral or partial claim might be right for you if you can resume your regular payments but can't afford to increase your payments. These options will either move your missed payments to the end of your loan or put them into a junior lien repayable only when you refinance, sell, or terminate your mortgage.
- A modification might be right for you if you can no longer afford to make your regular mortgage payment. Your payment can be reduced to an affordable amount and your missed payments will be added to the amount you owe. Your monthly payments could also be lower, but it could take longer to pay off your loan.
- A reinstatement (lump sum) might be right for you if you want to pay back all of your missed payments at once. For most loans, servicers cannot require you to pay a lump sum. So, if you only hear about a lump-sum repayment, ask about other options.
Just as forbearance may differ between the federally backed agencies or entities, so does the repayment of the forbearances. The following information provides some of the specific repayment options offered by each agency. If you have an FHA, VA, or USDA loan, check out the for borrowers.
Homeowners with mortgages owned or guaranteed by Fannie Mae or Freddie Mac may be eligible for different repayment options following your forbearance. Fannie Mae and Freddie Mac do not require a lump sum payment at the end of the forbearance
- If you are unable to repay your missed payments all at once and can afford to pay a higher monthly mortgage payment for a period of time, you may be eligible for a repayment plan which allows you to repay past due amounts over a period of time.
- If you can afford to resume your regular monthly mortgage payment you may be eligible for a , which puts your missed mortgage payments into a payment due at the sale or refinancing of your home, or at the end of the loan.
- If you have a sustained reduction in income and are unable to afford your regular monthly mortgage payment, you may be eligible for a loan modification which changes the terms of your loan to enable an affordable payment.
Servicers will reach out to you about 30 days before your forbearance plan is scheduled to end to determine which assistance program is best for you at that time. Work with your servicer to determine which option you are eligible for.
does not require lump sum repayment at the end of the forbearance. Homeowners on special COVID-19 Forbearance will be assessed by their servicer first for eligibility for FHA’s COVID-19 Standalone Partial Claim home retention option no later than at the end of the forbearance period.
The COVID-19 home retention option, called the COVID-19 Standalone Partial Claim, places amounts you owe into a junior lien that is repaid only when you refinance your mortgage or sell your home or your mortgage otherwise terminates. If you do not qualify for the COVID-19 Standalone Partial Claim, servicers of FHA-insured mortgages offer other solutions to help you repay the missed payments over time if you don’t qualify for the COVID-19 Standalone Partial Claim.
If you can resume making regular payments your servicer or lender should either offer an affordable repayment plan or term extension to defer any missed payments to the end of the loan. If you are unable to resume making regular payments, your servicer or lender should evaluate you for all available loss mitigation options.
Upon completion of the forbearance, the lender shall communicate with the borrower and determine if the borrower is able to resume making regular contractual payments. If so, the lender shall offer the borrower a written re-payment plan to resolve any amount due or, at the borrower’s request, extend the loan term for a period that is at least the length of the forbearance.
VA has a suite of loss mitigation options such as repayment plans and loan modification to assist borrowers in repaying payments missed under a CARES Act forbearance. In addition, VA is continuing to evaluate other options to further assist borrowers affected by the novel coronavirus (COVID-19) national emergency.
Native American Direct Loans (NADL) are managed by BSI Financial Services. NADL borrowers can request a forbearance plan by contacting the BSI default resolution team at 800-327-7861 or firstname.lastname@example.org.
Check with your loan servicer for the forbearance repayment options that they offer. You may be able to find information about forbearance programs by checking the websites of your lender and servicer for more detailed information. Be sure to inquire about what limitations, options, and fees may apply to repayment of your loan due to the fact that it is not federally backed.
Submit a complaint
If you have a problem with a consumer financial product or service, you can try reaching out to the company first. Companies can usually answer questions unique to your situation and more specific to the products and services they offer. We also can help you connect with the company if you have a complaint. You can submit to the CFPB online or by calling (855) 411-2372.