Loan Mod Q & A..What to do if Unemployed?

Question - I was recently laid off again and I am falling behind in my mortgage. What are my options this year with my lender?


Answer - Last year many of the major lenders and servicers teamed up with the government to institute a Mortgage Forebearance Program for homeowners falling back into distress in this economy.

Large lenders like Bank of America and Chase have mortgage forebearance programs in which the borrowers current financial status is evaluated and a reduced payment plan is put in place until the borrower can gainfully find employment again. The forebearance term can go from one month to six months.

Once the borrower and the lender agrees on a monthly payment, the deficient amount is rolled on back of the loan and due when the loan is reinstated. So for example, if your mortgage is $1,000 per month and you pay a forebearance amount of $500, you will owe the other $500 when you reinstate the loan. If you take a six month forebearance, you will owe $3,000 when you reinstate the loan.

The best thing to do in this situation is to apply for a modification so that the reinstatement amount is either forgiven or rolled into the back of the loan so you are not hit with a high reinstatement amount, and you will get a low fixed affordable payment amount.

If you have any additional questions, feel free to contact us a info@myforeclosureconsultant.com