According to the Mortgage Bankers Association(MBA), about 4.2 homeowners across America entered into forbearance agreements with their lender due to the pandemic. That is over 8% of all mortgage borrowers in the country.
Many homeowners in forbearance programs are curious if they will be able to purchase another home in the future. The short answer is yes, it will be possible to buy another home. There will be some requirements for these homeowners to be prepared for and aware of when they go to apply for a future mortgage loan. The rules will vary depending upon the type of loan you apply for.
In fact, the federal government recently issued new guidelines pertaining to home buyers searching to buy a new home or refinance a home after going through a forbearance period.
Borrowers with a traditional conventional mortgage loan will need to be current on the mortgage they went through forbearance with in order to qualify for a new loan. This applies to both refinance loans and new home loans. Borrowers must also wait a period of three months after the forbearance period ends to apply for a new loan. Borrowers will need to have made three consecutive payments under the forbearance repayment plan before obtaining a new loan. These requirements do not apply to government-backed loans such as FHA and VA loans.
There is hope after going through forbearance to purchase a new home in the future or move into a home that may be more affordable after finishing your forbearance period. With the new government-issued guidelines homeowners in forbearance have more hope of applying and qualifying for new loan programs.
It may be more difficult for a homeowner to enter into a new loan if they have sold their home while they were in the middle of their forbearance program, as they would have not met the above requirements. If you are in the middle of a forbearance program and are considering selling your home to help during a tight financial situation, don’t let these requirements scare you from looking at the possibilities. Selling your home during forbearance may be the right option to avoid missing or being unable to make payments after forbearance is over. It may be a better option to sell now than risk going into foreclosure later and taking a much bigger hit to your credit report that will take longer to recover from.
If you have questions about selling your home during or after forbearance it is a good idea to talk to a real estate professional.
For more information on selling or buying a home in Mexico Beach please contact us right away. We are here to find a Forgotten Coast home you love. For more information on moving to the Forgotten Coast or homes for sale in Cape San Blas and surrounding areas please contact us any time.
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