COVID-19 Forbearance Q&A

Q1: What kind of mortgage assistance is available for borrowers impacted by the Coronavirus?

A1: If a borrower has been impacted financially by the Coronavirus, whether through illness or due to loss of income or employment, they may qualify for mortgage assistance options, such as a forbearance plan related to their monthly mortgage payment.

Currently, Fannie Mae (FNMA), Freddie Mac (FHLMC), FHA, VA and USDA do NOT offer options to defer the amounts due meaning payments will not be added to the end of the loan nor is this a forgiveness.


Q2: What is a forbearance plan?

A2: A forbearance plan is a form of loan assistance that lets a borrower postpone their monthly mortgage payments for a period of time during a hardship. During the forbearance period, monthly payments are not required, and negative credit reporting and late charges will be suspended as well.


Q3: Does a forbearance plan mean that payments during the forbearance period will be forgiven?

A3: No. Once the forbearance period is completed, the payments that were suspended will be due.


Q4: When will payments need to be repaid?

A4: At the end of the forbearance period, a borrower will be required to pay the suspended payments in full. Borrowers will be contacted towards the end of the forbearance period to reassess their circumstances. Negative credit reporting and late charges will start again once the forbearance period ends unless other arrangements are made.

If the borrower is unable to pay in full at the end of the forbearance period, they may apply for further assistance such as repayment plan or modification.


Q5: How will a borrower know if they are eligible for a forbearance?

A5: If the borrower has been directly or indirectly impacted by the Coronavirus due to a temporary or permanent job loss or reduction in hours, the borrower may qualify for a forbearance plan in order to recover from this difficult time.


Q6: Can a forbearance be extended?

A6: Towards the end of the plan period, the hardship and financial status will be reassessed to determine eligibility for further workout options, which may include an extension of the plan and may have additional eligibility requirements.


Q7: Will a borrower still receive billing notices and delinquency letters during the forbearance?

A7: Yes. It is required for us to send monthly billing statements. Borrower should refer to their forbearance letter, which outlines the terms of the forbearance. The borrower will not be required to make any payments during the plan period. Although no late charges or adverse credit reporting will occur during the forbearance period, there are certain letters that we are required to send to ensure compliance with investor guidelines.


Q8: Can a borrower submit payments during the forbearance plan?

A8: Yes, the borrower can submit payments, but are not required to during the forbearance period. These payments will not be applied to the loan until the forbearance period ends.


Information believed to be accurate but not warranted.

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