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How to Avoid Foreclosure When Forbearance is No Longer an Option

by | Apr 2, 2021

man with head in hands
It’s hard to believe it’s been a full year since the pandemic changed our world. Since then, millions of Americans have persevered through hard times with the help of programs like the CARES Act. This act includes the forbearance program, providing homeowners with temporary mortgage payment relief. The key word there, however, is temporary. At some point, the reduced or paused mortgage payments for those with financial hardship due to COVID-19 will need to be paid back, along with the interest they’ve accrued. 

But what if your financial hardship has not ended once the forbearance program ends? If you’re concerned that you will continue to have trouble making your mortgage payments, take heart. You will still have options to avoid foreclosure and keep your home.  

Avoid Foreclosure with a Repayment Plan

The CARES Act forbearance program states that you do not need to repay your suspended payments all at once, so when the program ends, don’t worry — you will not take a huge financial hit. Instead, you’re encouraged to work with your mortgage lender to come up with a plan that’s satisfactory for you both. This could be an extension to your loan with the missed payments tacked onto the end of it, or the missed payments can be spread out over time, making them less of a burden. You might also be able to defer your missed payments until you sell or refinance your home or your mortgage ends. 

Foreclosure isn’t enjoyable for anyone involved, so rest assured your lender wants you to keep your home as much as you do. This means they will likely be happy to help create a missed payment plan that works best for you. Such a plan will lessen the financial strain of repayment and make the goal (both yours and your lender’s) of avoiding foreclosure and keeping your house more attainable. 

Avoid Foreclosure by Selling Quickly

While the whole idea of avoiding foreclosure is so you can keep and stay in your home, if a repayment plan is not enough to help you keep up with your payments comfortably, you may need to pivot and avoid foreclosure to save your credit rather than your house. 

You see, if your home goes into foreclosure, you’ll not only lose your house but in addition, your hard-earned credit will be damaged to a point where you’ll have trouble finding a lender to purchase a home later in life. 

Rather than have your financial troubles follow you into the future, selling your home before looming foreclosure sets in is your best option. The catch is, though, it’s a race against time. You need to sell as quickly as possible before foreclosure procedures begin. The best way to do that is to sell your home to a real estate investor. 

Real estate investors buy homes as they are, so you don’t have to take precious time (and money) to make repairs or updates. They also tend to cut out the realtor for a faster turnaround, and close quickly with cash, allowing you to pay off your debt and move on without a credit hit or financial penalty.

You can even discuss the possibility of paying rent to the investor who purchases your house so you can avoid foreclosure by selling your home but still remain living in it. 

Avoid Foreclosure with the Help of Renewed Homes

When forbearance is no longer an option and you feel you need to sell your house fast to avoid foreclosure, Renewed Homes can help. We’ll work with you to find a creative solution that best fits your needs and allows you to live comfortably without worry. For more information, reach out to our team today. We are here for you, and together, we can help you get through this.

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