Foreclosure and Forbearance Alternatives

[Kevin Uzelac]

We all know that COVID-19 has had some extreme affects on the mortgage industry. The low interest rates and high demand has caused prices to sky rocket in most markets. 

Although, there are a significant amount of people that are struggling to find a way out of financial hardships the pandemic has created. According to DS news, roughly 2.1 million homeowners are at risk of foreclosure. This is a little scary as we know what kind of effect mass foreclosure can have on the industry. I don't believe we will see something like the 2008 housing crisis, but foreclosure should be avoided at all costs so home prices are not negatively impacted. 

If borrowers are unable to make payments and extensions around forbearance and foreclosure protections are lifted, home seller programs are a good place to look. They create a lot resources to the borrower and the servicer so that homes can be sold before they reach foreclosure.

Currently, the forbearance and foreclosure protections for federally guaranteed mortgages has been extended through June 30, 2021 so time is limited. Struggling homeowners should be proactive with their lender to see what options they have before default. I wish the best for anyone who has been hit hard by the pandemic. Let's work together to dig ourselves out of the this hole.