What Do I Do Now That My Mortgage Forbearance Ended?

As a result of the lockdown and business closedowns due to the COVID-19 pandemic, a lot of American households had serious financial difficulties. In fact, many individuals and families couldn’t continue paying their mortgages. In order to alleviate the economic impact of the COVID-19 pandemic, the federal government introduced mortgage forbearance relief for the affected homeowners.

However, with the mortgage forbearance program coming to an end, homeowners exiting the program will have to decide how to resume payment of their suspended home loans. If you were affected by COVID-19 financially and your mortgage forbearance has ended or is about to end, consulting with an experienced Nevada bankruptcy attorney is important for proper guidance.

The Law Office of Scott N. Tisevich is committed to offering knowledgeable guidance and advocacy to clients in the legal matters of bankruptcy and COVID-19 forbearance. Scott N. Tisevich is available to discuss your unique financial situation and enlighten you about your different repayment options once your mortgage forbearance ends. The firm proudly serves clients throughout Reno, Las Vegas, Churchill County, Lyon County, Douglas County, Carson City, and Story County, Nevada.

Understanding Mortgage Forbearance

Mortgage forbearance involves a temporary modification on your home loan or mortgage payment obligations. In 2020, many American households sought mortgage forbearance relief under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Under the program, your mortgage servicer or lender will permit you to modify – reduce, pause, or suspend – your home loan payments completely for a certain period to allow you to recover financially.

Under the CARES Act Mortgage Forbearance program, homeowners were eligible for an initial forbearance plan of between three to six months. In the event that you need more time to rebuild your finances, you can seek two additional three-month extensions for a maximum of 18 months of total COVID-19 forbearance. However, once you leave the mortgage forbearance program, you must keep paying back your home loan repayments and any accrued interests.

My Options Now That Forbearance Has Ended

Now that your forbearance period has ended, your possible repayment options include:

Repayment plan – Propose a workable repayment plan to your mortgage servicer to settle missed payments over a specified period.

Deferral or partial claim – Resume your regular monthly mortgage payments and transfer missed payments to the end of the loan or after selling your home.

Loan modification – Make your mortgage payments easier by adjusting the principal amount, length of your mortgage, or interest rates.

Mortgage or loan reinstatement – Restore your mortgage by paying the total amount past due through a lump sum payment.

A knowledgeable attorney can help you understand the benefits and drawbacks of each repayment option and determine the right one for your unique financial situation.

Repayment Options for Various Agencies

Here are the repayment options for various agencies:

Fannie Mae & Freddie Mac loans:

• Payment deferral

• Repayment plan

• Loan modification

FHA/HUD loans:

• COVID-19 Recovery Modification

• COVID-19 Recovery Standalone Partial Claim

USDA Rural Housing Service Guaranteed Loan Mortgages:

• Payment deferral

• Affordable repayment plan or term extension

VA loans:

• Loan modification

• Repayment plans

However, homeowners who obtained a non-federally backed loan should check with their loan servicer to understand the available forbearance repayment options. An experienced lawyer can evaluate your various options and help you understand the laws and rules to avoid foreclosure on your property.

New Rule to Avoid Foreclosure

The Consumer Financial Protection Bureau (CFPB) enacted new rules to protect property owners who are going through financial distress. These new rules were designed to give affected homeowners sufficient time to repay their loans and avoid foreclosure on their homes. Below are some important provisions of the new rules:

• Before starting any foreclosure proceedings, the loan servicer must make considerable efforts to contact the debtor.

• Before starting any foreclosure proceedings, debtors must complete and submit a loss mitigation application. The loan servicer will review their application thoroughly.

• Before starting foreclosure proceedings, the loan servicer must confirm that the property has been abandoned under local and state laws.

• Also, loan servicers must give property owners up to three or more options to avoid losing their property.

These new rules to avoid foreclosure will be in effect from August 31, 2021, to January 1, 2022.

Skilled & Compassionate Advocacy

Now that you’re about to exit the COVID-19 forbearance program, it is important that you start making suitable plans to pay back your suspended home loan. This may require crafting a strategic repayment plan to leave the mortgage forbearance program smoothly without facing financial distress. Therefore, consulting with a skilled bankruptcy attorney is crucial to explore your possible repayment options and help you make informed decisions.

Scott N. Tisevich has the skills, resources, and diligence to advise and guide individuals and families in bankruptcy-related matters, including mortgage forbearance. As your legal counsel, he can enlighten you about the benefits and drawbacks of the different repayment options that are available to you and strategize an effective plan to help you stay on track with your unique financial goals.

Whether you want to defer payments, keep making mortgage payments, modify your home loan, or sell your property, Scott N. Tisevich can evaluate each option and help determine the best course of action. Also, he can help you craft a detailed strategy to leave the mortgage forbearance program seamlessly, resume payment of your suspended mortgage, and avoid foreclosure on your property.

Contact the Law Office of Scott N. Tisevich today to schedule a one-on-one consultation with a knowledgeable bankruptcy attorney. Scott N. Tisevich can offer you the experienced legal counsel and reliable advocacy you need to navigate key decisions. The firm proudly serves clients throughout Reno, Las Vegas, Churchill County, Lyon County, Douglas County, Carson City, and Story County, Nevada.