Mortgage Forbearance
- Thread starter sgip
- Start date
NEW -> Contingent Buyer Assistance Program
If you're in forbearance it is reported to a database. Lenders that I'm working with are making borrowers sign an affidavit that they are not applying for or have an active forbearance plan. I personally did it on my investment property just as an insurance policy but I had to get written cancellation to finish off my loan refinance on another property.
I?ve never been late or skipped any payments on my Chase loan. They offered me a mortgage rate reduction last month that didn?t involve any term length changes, only lower rate and thus lower monthly payment. Only had to sign 1 document and took just 1 day. Would this be considered a loan modification and looked down upon in regards to my credit score/history?
rkp said:
If you're in forbearance it is reported to a database. Lenders that I'm working with are making borrowers sign an affidavit that they are not applying for or have an active forbearance plan. I personally did it on my investment property just as an insurance policy but I had to get written cancellation to finish off my loan refinance on another property.
The below is what is outlined on payment relief communication on 1 of my account, the other account still waiting written communication but the due date online shows 7/1 with same monthly payment.
Your short-term payment relief
- We won't report a past-due status for this account to the consumer reporting agencies
- We won't charge late fees.
- If the account is past-due, we won't refer it to foreclosure during this time
What you need to know
- We have suspended your obligation to make your monthly mortgage payment for three months.
Unless you receive further relief, you'll need to resume your regular mortgage payment schedules on July 1, 2020
- When short-term relief ends:
We understand you may not be able to make the missed payments in a lump sum. If you need handle the suspended payments. Possible options may include:
-- A continuation of the payment suspension
-- Moving the missed payments to end of the loan
-- Modification
Your short-term payment relief
- We won't report a past-due status for this account to the consumer reporting agencies
- We won't charge late fees.
- If the account is past-due, we won't refer it to foreclosure during this time
What you need to know
- We have suspended your obligation to make your monthly mortgage payment for three months.
Unless you receive further relief, you'll need to resume your regular mortgage payment schedules on July 1, 2020
- When short-term relief ends:
We understand you may not be able to make the missed payments in a lump sum. If you need handle the suspended payments. Possible options may include:
-- A continuation of the payment suspension
-- Moving the missed payments to end of the loan
-- Modification
Mr. Cooper's (Nationstar), one of the largest mortgage servicers, forbearance plan details:
A Forbearance Plan is not a deferral, so the missed payments are not simply placed at the end
of your loan.
A Forbearance Plan is not forgiveness of any portion of the debt.
Once the temporary Forbearance Plan has expired, the full amount that you did not pay during the term of the Forbearance Plan will be immediately due. At that time, you will either need to pay the full amount or contact us to find out what options may be available to bring your account current.
As a result of not making your regular monthly payments, you will become delinquent on your mortgage. We will not report the Forbearance Plan or the delinquency status of your loan to credit reporting agencies for the duration of the Forbearance Plan. However, your credit score may still be impacted. While there is no negative credit reporting from Mr. Cooper during the Forbearance Plan Period, credit scoring companies may consider whether there is an increased credit risk due to the lack of reporting. We are uncertain as to the impact on your credit score, particularly if you are current on your mortgage or otherwise have a good credit score. This credit reporting suspension will continue only while the Forbearance Plan is in place, but you will be reported delinquent at the conclusion of the Forbearance Plan if you do not bring the account current at that time or enter into a workout plan to bring the account current.
I think the bolded point is how lenders and credit agencies will indirectly determine that you're in forbearance and an increased credit risk.
A Forbearance Plan is not a deferral, so the missed payments are not simply placed at the end
of your loan.
A Forbearance Plan is not forgiveness of any portion of the debt.
Once the temporary Forbearance Plan has expired, the full amount that you did not pay during the term of the Forbearance Plan will be immediately due. At that time, you will either need to pay the full amount or contact us to find out what options may be available to bring your account current.
As a result of not making your regular monthly payments, you will become delinquent on your mortgage. We will not report the Forbearance Plan or the delinquency status of your loan to credit reporting agencies for the duration of the Forbearance Plan. However, your credit score may still be impacted. While there is no negative credit reporting from Mr. Cooper during the Forbearance Plan Period, credit scoring companies may consider whether there is an increased credit risk due to the lack of reporting. We are uncertain as to the impact on your credit score, particularly if you are current on your mortgage or otherwise have a good credit score. This credit reporting suspension will continue only while the Forbearance Plan is in place, but you will be reported delinquent at the conclusion of the Forbearance Plan if you do not bring the account current at that time or enter into a workout plan to bring the account current.
I think the bolded point is how lenders and credit agencies will indirectly determine that you're in forbearance and an increased credit risk.
sgip
Well-known member
Thanks Yes2 and Cares. Very helpful.
Regarding Yes2's post:
What you need to know
- We have suspended your obligation to make your monthly mortgage payment for three months.
Unless you receive further relief, you'll need to resume your regular mortgage payment schedules on July 1, 2020
Interesting that you are being told to make your regular payments versus being required to make a different payment to catch up. Also....
- When short-term relief ends:
We understand you may not be able to make the missed payments in a lump sum. If you need handle the suspended payments. Possible options may include:
-- A continuation of the payment suspension
-- Moving the missed payments to end of the loan
-- Modification
Moving payments to the end of the loan is a modification - as is the other option - a modification!
We are also being told that "Interest will continue being accrued on the unpaid payments during the 90 days forbearance"
Any other written data anyone has would be great to see.
my .02c
Regarding Yes2's post:
What you need to know
- We have suspended your obligation to make your monthly mortgage payment for three months.
Unless you receive further relief, you'll need to resume your regular mortgage payment schedules on July 1, 2020
Interesting that you are being told to make your regular payments versus being required to make a different payment to catch up. Also....
- When short-term relief ends:
We understand you may not be able to make the missed payments in a lump sum. If you need handle the suspended payments. Possible options may include:
-- A continuation of the payment suspension
-- Moving the missed payments to end of the loan
-- Modification
Moving payments to the end of the loan is a modification - as is the other option - a modification!
We are also being told that "Interest will continue being accrued on the unpaid payments during the 90 days forbearance"
Any other written data anyone has would be great to see.
my .02c
sgip
Well-known member
It's very confusing no matter who is putting out this information!
Are the 3 unpaid payments being charged interest over the unpaid period (P1, 90 days, P-2 60 days, and P-3 -30 days only?)
At what rate are these payments being charged?
If the payments are added to the end of the loan, what happens to the accrued interest? Is it payable in one lump sum?
What's the APR on this interest charge?
Aye Carumba there's a million ways to spin this, and unfortunately it's still not clear to anyone.
At minimum perhaps this might be one way to guesstimate the cost: A $500k loan payment at 4% is $2,387 per month. X 3 payments is $7,161 x 4% (the example current rate) is $286. So will you owe $286 every month you don't pay this back? Not really sure. I can't imagine the cost would be any higher, but these are unique times we live in.
This question is why I've been urging readers to get everything in writing before considering a mortgage payment forbearance. Not a slam to anyone in this situation, as I'm sure there are plenty of lurkers asking the same question, but not finding very substantial answers. I wish I had some, but don't.
Bottom line: Until every question is answered by someone of authority in writing, take no action and trust no one.
Are the 3 unpaid payments being charged interest over the unpaid period (P1, 90 days, P-2 60 days, and P-3 -30 days only?)
At what rate are these payments being charged?
If the payments are added to the end of the loan, what happens to the accrued interest? Is it payable in one lump sum?
What's the APR on this interest charge?
Aye Carumba there's a million ways to spin this, and unfortunately it's still not clear to anyone.
At minimum perhaps this might be one way to guesstimate the cost: A $500k loan payment at 4% is $2,387 per month. X 3 payments is $7,161 x 4% (the example current rate) is $286. So will you owe $286 every month you don't pay this back? Not really sure. I can't imagine the cost would be any higher, but these are unique times we live in.
This question is why I've been urging readers to get everything in writing before considering a mortgage payment forbearance. Not a slam to anyone in this situation, as I'm sure there are plenty of lurkers asking the same question, but not finding very substantial answers. I wish I had some, but don't.
Bottom line: Until every question is answered by someone of authority in writing, take no action and trust no one.
We are deferring your payments and extending the term of your
loan as you requested
Thank you for reaching out about your payment. We understand these are uncertain times and appreciate you
reaching out to discuss your specific situation. We?re glad we could come up with a plan to help.
Here are the details
? We are deferring three payments due on your loan and extending the term of your loan by three months. ? As a reminder these loan payments will not be forgiven or waived, and interest will continue to accrue on
your loan during the extension period. ? You can still make payments on your account at any time. ? If we don?t hear from you prior to your next payment due date, we?ll assume you are no longer in need of
assistance and your regular monthly payment schedule will resume. ? We will not report your account to the credit bureaus as past due during the deferral period, and we will
waive any late charges that would normally accrue.
loan as you requested
Thank you for reaching out about your payment. We understand these are uncertain times and appreciate you
reaching out to discuss your specific situation. We?re glad we could come up with a plan to help.
Here are the details
? We are deferring three payments due on your loan and extending the term of your loan by three months. ? As a reminder these loan payments will not be forgiven or waived, and interest will continue to accrue on
your loan during the extension period. ? You can still make payments on your account at any time. ? If we don?t hear from you prior to your next payment due date, we?ll assume you are no longer in need of
assistance and your regular monthly payment schedule will resume. ? We will not report your account to the credit bureaus as past due during the deferral period, and we will
waive any late charges that would normally accrue.
sgip
Well-known member
The Note you signed at the closing of your loan is a contract.
With the term being extended an additional 3 months, will you be signing a new Note?
I think this remains to be seen. If this was a Marriage Settlement Agreement, a property lease, or a Child Custody Order being modified, I'm sure everyone would want it to be in writing!
Keep the information coming. It's all very helpful.
With the term being extended an additional 3 months, will you be signing a new Note?
I think this remains to be seen. If this was a Marriage Settlement Agreement, a property lease, or a Child Custody Order being modified, I'm sure everyone would want it to be in writing!
Keep the information coming. It's all very helpful.
sgip
Well-known member
From an e-mail sent to a borrower by Wells Fargo. Important concerns are in BOLD and ITALICISED and UNDERLINED
After the payment suspension period ends
If you need more time at the end of your initial three-month payment suspension period, depending on the type of loan you have, you may have the option to extend the payment suspension up to an additional three months, for a total of six months. If you choose to extend your payment suspension period, you will still need to repay all missed payments. When it comes time for you to repay, we?ll review your financial situation and discuss options with you.
Depending on the type of loan you have and your situation, your options may include:
An additional payment suspension: You may be able to continue the six-month payment suspension for up to an additional six months.
A lump-sum payment: If you can, you repay the entire amount due at once.
A repayment plan: We?ll divide the amount due from the amount of missed payments into manageable amounts, spread out over time.
Payment deferral: We?ll move the amount of the suspended payments to the end of your loan term.
A loan modification: We may be able to change certain terms of your loan ? such as the interest rate or the time allowed for repayments to make payments more manageable. Your modified payment amount is based on your current financial situation and takes any hardship into account.
After the payment suspension period ends, reporting the past-due status to the consumer reporting agencies, late fees, and possible foreclosure activities may begin or resume.
What you need to know about automatic payments
If you?re making automatic payments from bill pay on Wells Fargo Online? or with any other financial institution, you?ll need to stop them.
If you have a plan with us to withdraw your mortgage payments directly from your checking or savings account, we?ll stop that for you.
Once the payment suspension period ends or when you?re able to make payments, you?ll need to set up any automatic payments or plans again.
Ending the payment suspension early
You can end the payment suspension at any time. If you decide to shorten the plan, or if you decide later that this is not the right solution for you, please contact us.
Short-term payment suspension impacts
You?ll continue to receive statements every 30 days that show an amount due. We?re legally required to do so. The statement will refer to your short-term payment suspension under Important Messages.
If the loan was modified under the Home Affordable Modification Program (HAMP) or Second Lien Modification Program (2MP) and you don?t make a payment during this time, you could lose the pay-for-performance incentives. This is because you must remain in good standing with HAMP and 2MP.
If you have a loan modification that offers principal forgiveness that requires you to be current on your loan, you risk losing that benefit. Contact us to discuss your situation.
If you would like to refinance your current mortgage loan or obtain a new mortgage loan or home equity, the forbearance plan must be resolved in advance.
The more you know...?
My .02c
SGIP
After the payment suspension period ends
If you need more time at the end of your initial three-month payment suspension period, depending on the type of loan you have, you may have the option to extend the payment suspension up to an additional three months, for a total of six months. If you choose to extend your payment suspension period, you will still need to repay all missed payments. When it comes time for you to repay, we?ll review your financial situation and discuss options with you.
Depending on the type of loan you have and your situation, your options may include:
An additional payment suspension: You may be able to continue the six-month payment suspension for up to an additional six months.
A lump-sum payment: If you can, you repay the entire amount due at once.
A repayment plan: We?ll divide the amount due from the amount of missed payments into manageable amounts, spread out over time.
Payment deferral: We?ll move the amount of the suspended payments to the end of your loan term.
A loan modification: We may be able to change certain terms of your loan ? such as the interest rate or the time allowed for repayments to make payments more manageable. Your modified payment amount is based on your current financial situation and takes any hardship into account.
After the payment suspension period ends, reporting the past-due status to the consumer reporting agencies, late fees, and possible foreclosure activities may begin or resume.
What you need to know about automatic payments
If you?re making automatic payments from bill pay on Wells Fargo Online? or with any other financial institution, you?ll need to stop them.
If you have a plan with us to withdraw your mortgage payments directly from your checking or savings account, we?ll stop that for you.
Once the payment suspension period ends or when you?re able to make payments, you?ll need to set up any automatic payments or plans again.
Ending the payment suspension early
You can end the payment suspension at any time. If you decide to shorten the plan, or if you decide later that this is not the right solution for you, please contact us.
Short-term payment suspension impacts
You?ll continue to receive statements every 30 days that show an amount due. We?re legally required to do so. The statement will refer to your short-term payment suspension under Important Messages.
If the loan was modified under the Home Affordable Modification Program (HAMP) or Second Lien Modification Program (2MP) and you don?t make a payment during this time, you could lose the pay-for-performance incentives. This is because you must remain in good standing with HAMP and 2MP.
If you have a loan modification that offers principal forgiveness that requires you to be current on your loan, you risk losing that benefit. Contact us to discuss your situation.
If you would like to refinance your current mortgage loan or obtain a new mortgage loan or home equity, the forbearance plan must be resolved in advance.
The more you know...?
My .02c
SGIP
irvinebullhousing
Well-known member
I am partly surprise and mostly pleased by the response from this thread. I am surprise that even with the rather large cost of a typical mortgage not just in Irvine, rather, larger part of OC are expensive, the forbearance at least from this forum is extremely low. So TIers are in good shapes and practice their finance well. I am pleased on two front, 1) most TIers that tunes in to this forum benefit widely from the economic prepare readiness. 2) Seconds, although this is still short in duration in term of this down turn, it so far proven to me at least that the homeowners are much more responsible with their finance and will come out ahead in this down turn than other in term of size of populations and social and economic vitality of the city. We will continue to monitor the data?s and I find Irvine will not only survive but will thrive more than any other adjacent cities.
irvinehomeowner
Well-known member
Yes, I think many of us regulars are either in essential jobs or are well financed to weather this kind of situation.
I don't see many saying they have lost their job or that they are struggling but there is probably a silent number that are not as well off and I hope for the best for them.
I think a side effect for those of us that are not as affected income wise is that our spending is down (42% for the bones/daedalus household) so that also precludes the need to delay mortgage payments.
I don't see many saying they have lost their job or that they are struggling but there is probably a silent number that are not as well off and I hope for the best for them.
I think a side effect for those of us that are not as affected income wise is that our spending is down (42% for the bones/daedalus household) so that also precludes the need to delay mortgage payments.
irvinebullhousing
Well-known member
And the FCB, like what it said Foreign Cash Buyers already bought and paid in full. The only other obligations that they have is property tax. Wahla. If this by year end and the lack of inventory persist, that will be not good for buyers.
Soylent Green Is People said:
I?ve never been late or skipped any payments on my Chase loan. They offered me a mortgage rate reduction last month that didn?t involve any term length changes, only lower rate and thus lower monthly payment. Only had to sign 1 document and took just 1 day. Would this be considered a loan modification and looked down upon in regards to my credit score/history?
sgip
Well-known member
What you received from Chase is a Rate Modification. These do not impact your credit. Last one I saw from Chase was a Jumbo and the pushed the rate down to 2.875 fee free.
Pro Tip: Have a Chase Jumbo? If you've applied for a refi ask the lender to have the payoff demand pulled IMMEDIATELY. It's a triggering event for lenders wanting to retain their customer. Chase may then send a "Rate Modification" letter to you with an amazing deal.
A Loan Modification changes balances, repayment terms and other loan properties. Do this, and your credit will suffer.
My .02c
Pro Tip: Have a Chase Jumbo? If you've applied for a refi ask the lender to have the payoff demand pulled IMMEDIATELY. It's a triggering event for lenders wanting to retain their customer. Chase may then send a "Rate Modification" letter to you with an amazing deal.
A Loan Modification changes balances, repayment terms and other loan properties. Do this, and your credit will suffer.
My .02c