TAMPA, Fla. (WFLA) – Many Tampa Bay area homeowners are turning to newly-announced mortgage forbearance programs to get help with payments.
For those who are dealing with job loss due to COVID-19 shutdowns, the chance to delay mortgage payments is welcomed. But many Better Call Behnken viewers say the deal they were offered didn’t offer much help in the long run.
Most say they were offered three-month deferments on their payments but had to pay the full amount, plus the next month at the end of the three months and many companies also charged fees for the service.
Andrea Reed, of Hamilton Group Funding, recommends you ask a lot of questions before
Agreeing to a forbearance offer and then get the deal in writing, in case the terms change later.
Here are questions to ask:
When will I repay? How much will I have to repay? Will my interest rate change? How many months will this add to the term?
“If you have a 30-year mortgage and you’re 5 years in, and you choose to do that forbearance for three months and they are tacking it on the end, it’s amazing how many years it can actually end up adding to the life of your loan,” Reed said.
Experts recommend paying your mortgage if you can. If you still have your job, but fear you could lose salary, you may want to check into refinancing, instead of asking for a forbearance. Your payment could go down and you could get a short break – before those new payments kick in.
If you’ve been your house for a long time, she says, a forbearance deal could cost you equity.
“People have a lot of equity in their homes right now, and if they get into trouble after that forbearance, they have a chance of losing all of that equity they’ve built in their house,” Reed said.
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