Everything You Need to Know About
Mortgage Forbearance [2023]

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Updated: May 11, 2023
author photo Written by Louis BakerUpdated: May 11, 2023
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Are you struggling to pay your mortgage due to a job loss, illness, or other financial setbacks? Mortgage forbearance may be an option to help you temporarily pause or lower your mortgage payments while you get back on your feet.

In this article, we'll provide an in-depth overview of mortgage forbearance, including who is eligible, the requirements for forbearance, and the pros and cons of this option. We'll also explore post-forbearance options for catching up on missed payments, alternatives to mortgage forbearance, and frequently asked questions about this topic.

What is Mortgage Forbearance?

Mortgage forbearance is a form of temporary relief that allows homeowners to pause or reduce their mortgage payments for a specified period of time. This option is available to borrowers who are facing short-term financial difficulties, such as a job loss, illness, or other unexpected financial setbacks.

Mortgage forbearance can be anything within 1 to 12 months, depending on the agreement between a borrower and their lender.

During the forbearance period, the lender may be allowed to pause payment or pay a fraction of the normal mortgage payment. This can help the borrower reduce financial stress and get back on their feet. It also helps to prevent foreclosure and payment defaulting.

Note: It's important to notice that forbearance is not loan forgiveness. The borrower is still responsible for paying back the full amount of the mortgage, including any missed payments, once the forbearance period ends.

Eligibility Criteria For Mortgage Forbearance

To be eligible for mortgage forbearance, you typically need to demonstrate that you are experiencing a financial hardship that is affecting your ability to make your mortgage payments. This may include a job loss, illness, or other unexpected financial setbacks.

Lenders have special circumstances in which they allow forbearance, so you have to ask your lender to know whether you qualify.

In response to the COVID-19 pandemic, the federal government has also implemented a COVID hardship forbearance program that is available to eligible borrowers with federally backed mortgages.

This includes loans backed by the Department of Housing and Urban Development (HUD)/Federal Housing Administration (FHA), Veterans Affairs (VA), United States Department of Agriculture (USDA), Fannie Mae, and Freddie Mac.

The bottom line is that only people that fall into the categories above were eligible for the forbearance.

Other lenders may also offer mortgage forbearance under special circumstances. You have to consult your servicer to ascertain that they allow mortgage forbearance.

How To Qualify For Mortgage Forbearance

To qualify for mortgage forbearance, you will need to meet certain requirements set by your mortgage servicer. These requirements may vary depending on the specific servicer and the type of loan you have, but generally, you will need to provide the following information:

  • Provide a detailed explanation of your financial hardship and show proof, like a sack letter, medical bill, or court order if necessary.
  • Your recent pay stubs.
  • A list of your monthly expenses.
  • The estimated duration of your financial hardship.
  • State whether you can afford the partial payment or not.

It's important to provide accurate and detailed information to your servicer to ensure that your forbearance request is processed as quickly as possible. Be sure to also communicate with your servicer throughout the forbearance period to keep them updated on any changes in your financial situation.

In response to the COVID-19 pandemic, the federal government has made adjustments to the requirements for mortgage forbearance. In the next section, we will discuss the CARES Act adjustments to requirements in more detail.

Requirement Adjustment By The CARES Act

The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal legislation that provides help to individuals who have been economically impacted by the COVID-19 pandemic.

Under the CARES Act, homeowners with government-backed mortgages are entitled to mortgage forbearance without providing documentation of financial hardship, as long as they attest to experiencing financial hardship directly or indirectly due to the pandemic.

The CARES Act also provides the following protections for homeowners with government-backed mortgages:

  • For people with pandemic-related Financial hardship, an initial forbearance period of 180 days is allowed and an extension of another 180 days, making it 360 days. Those with hardships unrelated to the pandemic will get a forbearance term according to their lender's evaluation.
  • Mortgage lenders are expected to report CARES-related forbearance to the credit bureaus to avoid harming the borrower's credit score and history.
  • No extra fees, penalties, or interest is introduced during or after the forbearance period.
  • Borrowers with CARES-related financial hardship are protected from foreclosure for at least 180 days following the CARES Act enactment.

If you have a federally-backed mortgage and are experiencing financial hardship due to the pandemic, you may be eligible for mortgage forbearance under the CARES Act. It's important to communicate with your mortgage servicer to understand your options and how the CARES Act may apply to your specific situation.

Note that you are only eligible for forbearance under the CARES Act if you have an FHA, USDA, or VA loan or if your loan is owned by Fannie Mae or Freddie Mac.

Steps To Get A Mortgage Forbearance

Step 1 Contact your mortgage servicer: You can find the contact information for your mortgage servicer on your monthly mortgage statement or by searching online.

Step 2: Give A Detailed Explanation of Your Financial Situation: Be prepared to provide details about your financial hardship, including the cause and expected duration.

Step 3: Tender Any Documents Required by Your Servicer: Your servicer will likely request documents to verify your financial hardship, such as pay stubs or medical bills. Make sure to provide all requested documents in a timely manner.

Step 4: Wait While Your Lender Makes A decision: Your servicer will review your request and determine if you are eligible for forbearance.

Step5: Read, Sign, And Submit the Forbearance Agreement: If your request is approved, your servicer will provide a forbearance agreement for you to sign and return.

Step 6: Adhere To The Agreement Terms: Once you have signed the forbearance agreement, make sure to follow the terms of the agreement, including making any reduced payments or no payments as agreed upon.

During the forbearance period, it is in your best interest to communicate with your lender about changes in your financial situation. This helps prepare your lender in case you need an extension or would like to resume payments again before the end of the forbearance.

Be aware that while forbearance can provide temporary relief, you will still need to repay any missed payments once the forbearance period ends.

When Does Application For Mortgage Forbearance End?

The deadline for a mortgage forbearance application depends on the type of loan you have.

If your loan is backed by HUD/FHA, USDA, or VA, you may request an initial COVID hardship forbearance as long as the COVID-19 National Emergency is in place. The National Emergency was extended until at least March 31, 2022, but it is subject to change.

If your loan is backed by Fannie Mae or Freddie Mac, there is not currently a deadline for requesting an initial forbearance. However, it's important to note that you will need to request forbearance before you fall behind on your mortgage payments.

If you are unsure if your loan is federally backed, you can contact your mortgage servicer or check with the relevant agency, such as HUD/FHA, VA, USDA, Fannie Mae, or Freddie Mac.

What is The Typical Duration For Mortgage Forbearance?

The length of mortgage forbearance can vary depending on the specific terms of the agreement between the borrower and the mortgage servicer. Typically, forbearance can last for up to 12 months, but some agreements may be shorter or longer.

Under the CARES Act, homeowners with government-backed mortgages are entitled to mortgage forbearance for up to 180 days, with the option to request an extension for an additional 180 days. This means that eligible borrowers can receive up to 12 months of forbearance under the CARES Act.

Benefits of Mortgage Forbearance

Temporarily Suspends Or Reduces Your Monthly Payments

Mortgage forbearance can help to reduce your mortgage payment or suspend it for a period. This takes the weight of the debt off your shoulder for some time while you get back on your feet. You will also be able to take care of your other expenses such as food, utilities, and medical bills more conveniently during that period.

Prevents Or Pauses Forbearance Process

Mortgage forbearance can save you from losing your property. In normal circumstances, failure to make your mortgage payment by the due dates may cause your lender to foreclose on your home. However, mortgage forbearance spares you from such.

Does Not Stop Home Sale Or Mortgage Refinance

Forbearance does not prevent you from selling your home or refinancing your mortgage once the forbearance period ends. If you are unable to afford your mortgage payments, selling the home or refinancing may be an option to consider.

Creates Chance To Access A Flexible Payment Term

Your servicer may offer flexible repayment options to help you catch up on missed payments once the forbearance period ends. This may include a repayment plan, loan modification, or other options that are tailored to your specific situation.

Setbacks Of Mortgage Forbearance

Missed Payments Must Be Paid

Forbearance only pauses or reduces your mortgage payments. After the forbearance period, you still have to make up for all the missed or partial payments. This may increase your initial repayment term or require a higher monthly payment if you stick to the initial loan term.

Your Mortgage Payments May Increase After the Forbearance Period Ends

After the forbearance period, your normal mortgage payment may increase in order to meet up with the missed payments. Alternatively, you can pay a lump sum to cover the missed payments or increase your loan term.

Borrowers With Rental Properties Or Second Home Mortgages Not Eligible

Mortgage forbearance is typically only available for primary residences. If you have a rental property or second home, you may not be eligible for forbearance.

Post-Mortgage Forbearance Options

If you have taken advantage of mortgage forbearance and are nearing the end of the forbearance period, you may be wondering what your options are for catching up on missed payments and staying current on your mortgage. Here are some of the post-mortgage forbearance options to consider:


Reinstatement is the simplest way to catch up on missed payments. It entails paying all your missed payments at once after the forbearance period. That, of course, is if you can afford the total payment at once.

If you have the financial means to do so, reinstatement can help you avoid foreclosure and get back on track with your mortgage payments.

Repayment Plan

A repayment plan is another option for catching up on missed payments. With a repayment plan, your servicer will add an agreed-upon amount to your regular monthly payments over a period of time (up to 12 months) to repay the forbearance amount.

This can help make catching up on missed payments more manageable by spreading out the repayment over a longer time period.

Loan Modification

A loan modification entails permanently changing the initial terms of your mortgage to make payment easier for you. When you apply, your lender may agree to extend your loan term, lower your interest rate or reduce your monthly payment.

So, if you cannot afford a reinstatement or repayment plan, a loan modification may be the best option. This helps you pay back your loan conveniently.

COVID-19 Payment Deferral

If you are still experiencing financial hardship due to the pandemic, you may be eligible for a COVID-19 payment deferral. This allows you to defer the missed payments until the end of the loan term or until you refinance, sell the home, or pay off the mortgage.

It's important to note that this option may not be available for all loans or in all circumstances, so you should discuss your options with your servicer.


Refinancing your mortgage may be an option if you are current on your mortgage or have resolved your forbearance plan.

Refinancing allows you to replace your current mortgage with a new one that has different terms, such as a lower interest rate or a longer loan term. This can help make your mortgage more affordable and allow you to catch up on missed payments.


If you are unable to afford your mortgage payments and are willing to move, selling your home may be an option. Selling the home can allow you to pay off the mortgage and avoid foreclosure. It's important to note that if you owe more on the mortgage than the home is worth, you may need to negotiate a short sale with your lender.

Keep in mind that different options may be available to you depending on your specific circumstances, and it's important to choose an option that is affordable and sustainable for you in the long term.

Alternatives to Mortgage Forbearance

If you don't qualify for mortgage forbearance or have concerns about the potential drawbacks of forbearance, there are several alternatives that can reduce the cost of your loan.

Reassess Your Tax Deductions

During a financial crisis, you can apply for tax deductions instead of forbearance. If you are eligible for tax deductions, like the mortgage interest deduction, your monthly payment may reduce. This helps to reduce the overall cost of your loan as well as lower your monthly payment.

If you are interested in tax deductions, consult with a tax expert or financial advisor to ascertain your eligibility and the implications of the strategy.

Consider A No-Closing-Cost Refinance Mortgage

As the name implies, a no-closing-cost refinance cost is a refinancing option that does not require a closing costs when you take out a new loan. However, that does not mean the cost would disappear. The lender simply moves it into your principal amount or charges a higher interest rate in turn.

So, instead of asking for a forbearance, you can opt for a no-closing-cost refinance loan. This helps you to change the terms of your current mortgage to a more convenient one. It also helps you to prevent foreclosure.

Request Help From Family and Friends

If you are struggling to make your mortgage payments, consider reaching out to friends and family for financial assistance. This can be a good short-term option to help you stay current on your mortgage until you are able to get back on your feet.

However, it's important to have a plan for repaying any loans or assistance received and to understand the potential impact on your relationships.

Consult A Housing Counselor

A housing counselor can provide guidance and support as you navigate your mortgage options. Housing counselors are trained professionals who can help you understand your options, negotiate with your lender, and develop a plan for staying current on your mortgage.

They may also be able to provide information on other resources and programs that can help you reduce your mortgage costs.

Remember that mortgage forbearance and other alternatives can impact your credit score and your ability to obtain credit in the future, so it's important to stay informed and make the best decision for your financial situation.


Does Mortgage Forbearance Affect The Credit Score?

Mortgage forbearance alone does not directly impact your credit score. However, it's important to note that missed payments during forbearance can impact your credit score.

Some lenders may also report the forbearance to credit bureaus, which can impact your credit report. It's important to communicate with your servicer and understand the potential impact on your credit before entering into a forbearance agreement.

What is the Difference Between Mortgage Forbearance and a Loan Modification?

Mortgage forbearance is a temporary pause or reduction in mortgage payments, while a loan modification is a permanent change to the terms of your mortgage.

Loan modifications may involve changing your interest rate, extending your loan term, or changing your payment structure to make your mortgage more affordable.

Do I Have to Pay Extra Interest for Forbearance?

This depends on the type of forbearance you're under. CARES Act-related forbearance, for instance, does not attract extra interest. However, it is different from other lenders. Some of them may charge extra interest for forbearance.

If you agree to such terms, then you have to pay the interest. That is why it is important that you read the terms of your contract carefully. You don't want to enter a debt snare.


Mortgage forbearance is a temporary relief option for homeowners who are facing financial hardship and struggling to make their mortgage payments.

This article provides an in-depth overview of mortgage forbearance, including eligibility requirements, pros, and cons, necessary documents, how to apply for this relief option, post-forbearance options, and alternatives to mortgage forbearance.

Whether you're exploring mortgage forbearance as an option or seeking other ways to reduce your mortgage costs, this article provides the information and guidance you need to make informed decisions about your financial future.

author photo

Written by

Louis Baker


Louis Baker started his career in 2017 by contracting with Experian. He also became a part-time content creator in various fields such as insurance, personal finance & investment, etc.

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