If you are exploring options to help you avoid foreclosure, you’ve likely heard of mortgage forbearance. While a mortgage forbearance may sound quite appealing at first glance, it’s important that you fully understand what they are and how they impact you during foreclosure before you contractually agree to one.
As a homeowner trying to avoid foreclosure, you should explore all available mortgage modification options to find the right one for your financial future. When considering the ways to protect your home, we recommend consulting a foreclosure attorney. An experienced attorney can help you explore every available option and choose the one best suited for your situation.
Joshua Denbeaux has been a New Jersey foreclosure attorney for over 15 years and has represented hundreds of homeowners facing foreclosure. Schedule a free consultation today to discuss your options to protect your home from foreclosure.
What is Mortgage Forbearance in NJ?
A mortgage forbearance is a short-term mortgage relief agreement between a homeowner and a lender. During a forbearance agreement, mortgage payments are reduced or suspended for a set period of time.
Is a Mortgage Forbearance a Good Idea?
While mortgage forbearance may be a good option for some, it may not be the best for others. Understanding the basics will help you identify if you should pursue forbearance or an alternative solution. Consider these pros and cons before you make any permanent decisions. You can also speak with an experienced foreclosure attorney to help you understand options in your unique situation and which may be best for you.
Pros of Mortgage Forbearance
There are many benefits of a mortgage forbearance agreement. The main ones are that you are able to avoid foreclosure while maintaining your residence, not having to worry about where you are going through a financial hardship and struggling to get back on your feet.
Pursuing a mortgage forbearance requires working with your lender, which is why mortgage forbearances are typically viewed as an option to create goodwill with your lender. In choosing to work with your lender to avoid foreclosure, they may be more willing to work with you again in the future, although there is no guarantee they will.
Cons of Mortgage Forbearance
Like many options for avoiding foreclosure, there are a few risks that homeowners should be aware of. One major con is that if the sale of your home is allowed under the terms of your forbearance agreement and you choose to sell your home, your lender can recover missed payments from the sale of your home. This means that your lender could be owed a significant amount of profit from the sale or even that you end up owing them additional payments if the sale doesn’t cover the amount owed.
The repayment of a forbearance could also serve as a reason to choose another option for modifying your mortgage or mortgage payments. There are a variety of options for repayment that your lender may allow you to choose from, including lump sum repayment, a repayment plan, or a mortgage modification. This could mean that at the end of your forbearance, you are left with higher monthly mortgage payments or a large lump sum to repay, which could be equally difficult or completely impossible due to your financial situation.
Ultimately, the decision of whether to pursue mortgage forbearance is up to you and what you think is best for your situation. But you may find peace of mind knowing you have other options to delay or stop foreclosure if the cons of forbearance outweigh the pros for you. If you’re facing foreclosure, one of the easiest ways to figure out what step you should take next is to consult a foreclosure defense attorney.
Contact a Trusted NJ Foreclosure Attorney Today
Altering your mortgage or entering into any sort of forbearance agreement is a big decision that should not be taken lightly. Before agreeing to a permanent, long-term agreement or alteration, you should strongly consider consulting with a trusted foreclosure attorney. Discussing your situation with an attorney may help ensure you’ve considered every possible avenue and that you are protected in any option that you choose.
You may not have the time, energy, or resources to defend yourself effectively in court, but a reliable attorney may be able to. Joshua Denbeaux has over 15 years of experience representing and defending hundreds of homeowners against foreclosure.
Schedule a free consultation today to learn more about how Denbeaux may be able to help you find a solution to avoid foreclosure.
