What to Do When Your CARES Act Mortgage Forbearance Ends

If you are like millions of other homeowners in Kansas, and you are behind on mortgage payment due to the COVID-19 pandemic, you may have taken advantage of the CARES Act Mortgage Forbearance Program to keep your home. The program allows you to pause or reduce payments for a limited period without paying the payments back or catching up on your payments in one lump sum.

Since the first coronavirus cases were reported in the U.S. in January 2020, nearly 17 million cases of COVID-19 have been reported. This has caused a massive decline in the economy - more specifically, the job market. If you have lost your job due to the pandemic, you may be in danger of losing your home. Even if you took advantage of the Covid Mortgage Forbearance, and your forbearance period is coming to an end, you may still have difficulty making your payments.

The Coronavirus Aid, Relief, and Economic Security Act (CARES) provides a mortgage payment forbearance option for all borrowers who, either directly or indirectly, suffer financial hardship due to the coronavirus (COVID-19) pandemic. No documentation is required to prove financial hardship beyond your claim that you are suffering financially from COVID-19.

A forbearance is a temporary postponement or reduction of mortgage payments. However, keep in mind that it is not payment forgiveness. Under the CARES Act, you are entitled to an initial forbearance period of up to 180 days upon approval of your request. The forbearance can be extended for an additional 180 days after the initial forbearance ends. You can, at any time, shorten the forbearance and resume repayment of the loan.

Once the mortgage forbearance period ends, your adjusted payments resume. Although you are not required to pay back the late payments in a lump sum, your adjusted payments may increase so that you can pay back the late payments in smaller increments.

Note: While the forbearance plan can provide temporary relief, the pandemic has outlasted most forbearance periods, leaving homeowners in the same financial situation as they were in before enrolling in the CARES Act Mortgage Forbearance program.

If you are a homeowner that has completed the forbearance plan but are still behind on mortgage payments, you could face the following situations:

You may be looking at options that help you avoid foreclosure, such as loan reinstatement, debt restructuring, bankruptcy, or forbearance. However, these options can only make matters worse. They require long, drawn-out processes in which you may have to hire a lawyer to challenge the bank. Plus, they may not solve the underlying problem: your inability to make the payments on your house.

A better solution is to sell your house for cash to Blue Sky Properties. There are several benefits to selling your house for cash, such as: