Forbearance Math
Mom and Dad have a mortgage.
It’s currently $1,500 per month.
Dad gets laid off, calls the servicer, and asks for forbearance.
In one phone call, he gets 6 months “off” from paying.
Seven months later, Dad is finally back to work and hasn’t been able to save any money during the forbearance.
Forbearance is lifted and servicer says, “That will be $9,000 + $1,500, which is now due”. ($10,500)
Dad almost passes out and says, “WHY??”
Servicer: “That’s the 6 months of forbearance plus the current month.”
Dad: “I can’t do that, can we work something out?”
Servicer: “Sure, we will spread out the $9,000 over 12 months.”
Dad: “Phew….ok, good. What will that look like?”
Servicer: That will be $2250 a month for the next 12 months.”
Dad: ” OMG!!! I can’t afford that.”
Servicer: “Sorry…..”
Dad: “Can I refinance?”
Servicer: “No because the loan went into forbearance.”
Dad: “What can I do?”
In a nutshell, this is forbearance, folks. Forbearance is not forgiveness. There are some variations on this and last night I heard Ben Carson state with FHA loans it can be tacked on the end (it’s called recasting generally but for FHA it’s COVID-19 National Emergency Partial Claim). My point is you need to know what you’re getting yourself info. Ask questions and read everything.
I need to keep putting this message out there because I am getting a lot of questions. Please understand the seriousness of this. If you have any questions, I am always here for you. Even if you just want to pick up the phone. I can refer you to a great lender or an attorney to talk to as well.
If you’re struggling and just need to talk to someone, I’m here. I’ll talk with you.
I mean it.
If you want to schedule a 30-minute call you can click on this link. It will take you to a calendar where you can request a 30-minute time block. I’ll accept and we’ll get on Zoom to talk face to face.
We can even talk longer if you want. I just want to make it easy to get face to face.
I’m here if you want to reach out.
I hope you will.
Thanks for listening,
Jerry Robertson
678-231-1578 Direct Line
BTW, credit where credit is due, I copied the math part from a Facebook post and would like you to know that. Not sure who came up with it but it was clear and easy to understand.