Help me understand the mortgage forbearance agreement

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The deferred payments will be due at the end of the three-month plan.

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I thought they were just tacking them on to the end of the mortgage and not charging late fees.

You sure that’s what it says? Or does it say something like at the end of the term?

Run away. Don’t do it.

Turns out to be a loan modification. And depending on your lender, it’s a very misleading and tedious process.

ConsumerFinance.gov

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Questions to ask What options are available to help you temporarily reduce or suspend my payments? Are there forbearance, loan modification, or other options? Can you waive late fees? Get it in writing

Once you’re able to secure forbearance or another mortgage relief option, ask your servicer to provide written documentation that confirms the details of your agreement and that you’re clear on what the terms are. With some forbearance programs, you may owe all of your missed payments at one time, or additional payments at the end of the mortgage might be required, so make sure you’re familiar with the final terms.

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The only other option is loan modification they call it. This is basically a refinance and a new agreement. They have to come to a house do a inspection and draw you up a whole new mountain of paperwork to sign

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That happened to me back around 2009 or so when I went through a rough patch. They offered me a loan modification and reduced my interest 2% points and added the past due back to the principle. I took it but it was a huge mistake. They immediately sold my to some really crappy service company, Ocwen, and I never could get someone that knew what they were talking about. They couldn't give me a pay history and always considered my in collections, even 4 years later of On Time payments. It was really tough to get away from them.

The usual, not seen this specific one though, is to "defer" the payments to the end of the note.

So your example of 6/20-9/20 would hold. Without late payment fees since the lender is agreeing the due date is moving 3 months.

What you do get though is 3 months interest accrual. Depending on how early into your term is how big a difference that makes (higher principal = higher accrual vs late in your term lower principal = lower accrual) in actual cost.

Then there's the whole decision making on whether your job and income (separate things in this new paradigm) will return in the 3 months or so, what inflationary impact artificially inflating the amount of money supply by several Trillions will do to cost of living, etc..

If very very early in the term of the mortgage and questionable income return it could be better to walk away. Or it could be in one's best interests to remain. Purely an individual decision.

As a previous mortgage lender I can understand both sides of the equation. Can't fault the individual for making the best decision for themselves. Can't fault the lender for trying to protect themselves either. Situation like the current one could easily be a lose/lose case with the negotiations around who loses more, or equally, lender vs debtor.

Good luck!

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If you had GMFS in 2016 they royally screwed you with that exact thing.

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They hold their loans now? They used to sell them really quickly, usually after the first payment. That's who I originally was with, then sold to GMAC Mortgage, who then sold me to Ocwen, which was horrible.

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f you defer for three months with a forbearance say May, June, July, then in august when it's up you owe for May, June, July, and August.

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I’ve been hearing this and seeing people on Facebook posting this so I called my mortgage company out of curiosity because this makes zero sense. If you have a $2,000 mortgage and are laid off and can’t make payments, how the hell are you supposed to pay $6,000 in 3 months. My mortgage company told me you have the OPTION to pay for the 3 months (mine offers up to 6 months) but most people will just have their payments posted to the back end of the loan. I guess other lenders could be different but mine gives you options.

My mortgage company told me that since they're not a bank they can't move it to the end, and that they are regulated different than banks. All due at end of three months. Had to call to learn that.