What To Do If You Can’t Pay Your Mortgage
In Arizona, COVID-19 is having an effect on everything from education to employment, businesses…pretty much our world as we knew it. As a result of our state shut down, many businesses and people have been negatively impacted. I know that there are some people out there that are hurting, struggling. This has not been a good situation and now they may be looking for alternatives to keep from losing their homes. There are options. You could be asking yourself, what can I do if I can’t pay my mortgage?
First, communication with your mortgage lender is key. If you are not able to make your payment, do not simply skip the mortgage payment without talking with your lender. Ignoring the issue will not make it disappear. Believe me, I learned the hard way on that during the course of my life.
If you do not communicate with the lender, they won’t know what is going on and why your payments are not being made. And you won’t know what they can do to help you keep your home. So, pick up that phone and call them. Let them know your situation and ask for help. Each mortgage lender has a slightly different version of how to help their clients during times of financial strain, make sure you get as much information as you can to make your decision.
Difference between forbearance and deferment
What could your decision look like at this time? You could choose to do a forbearance or a deferment. A forbearance is a grace period where you can possibly make partial payments towards the mortgage or no payments. However, once the forbearance period is over, all the missed payments plus your current payment are due. It may be a balloon payment, or it could be spread out over a few months. It all depends on your lender.
A deferment is where you may skip payments and they will be tacked on to the end of your mortgage agreement. This could potentially extend your mortgage loan by a month or more. Regardless of which option you choose, the payments will be due at some point in the future. .
If you know of anyone that is considering a forbearance or deferment on their mortgage, this would be a great blog to forward to them. I am not a mortgage lender. But I have been in real estate since 2006 and worked through one of our toughest markets on record during the recession a few years ago. I can share with you what I learned during that time.
As always, I am happy to be of service to you and your family. Please do not hesitate to contact us with any questions or concerns. Thank you.
Stay safe, friends!