If you’re unemployed and having trouble making payments on your FHA-insured mortgage, more help is on the way! The Federal Housing Administration (FHA) already requires its lenders to go the extra mile in helping un- or underemployed borrowers who are at least three months behind in their mortgage. Now, FHA is providing additional breathing room for unemployed homeowners by requiring FHA-approved lenders to extend special forbearance from four to 12 months.
This means certain unemployed borrowers with FHA-insured mortgages may have up to a full year to find work and get back on their financial feet. These special forbearance agreements between lenders and borrowers make it possible to delay any foreclosure action to allow you a chance to catch up missed payments in an agreed-upon timeframe. At the end of the forbearance period, the lender will review your financial situation again to determine what option might fit your circumstances like a loan modification or repayment plan. The extended forbearance period begins August 1st with another 60 days for lenders to implement.
But what if you don’t have an FHA-insured mortgage? The Obama Administration also intends to require lenders participating in the Making Home Affordable Program (MHA) to extend the minimum forbearance period to 12 months wherever possible under regulator and investor guidelines.