Can You Have Another Forbearance on a Mortgage?
Forbearance allows homeowners in distress to avoid foreclosure. Mortgage forbearance occurs when your loan payments are temporarily suspended or reduced to account for a loss in income. Forbearances are granted through mortgage lenders. Homeowners can qualify for mortgage forbearance multiple times as long as they meet the minimum requirements of the program.
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Circumstances
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To qualify for a second mortgage forbearance, your income must be dramatically reduced or stopped due to temporary hardship. Lenders are more likely to scrutinize your request the second time around if your request is within 12 months of your first mortgage forbearance. Provide your lender with a hardship letter and documentation supporting your request, such as a letter from your employer outlining the terms of your pending disability leave or furlough. Copies of household bills and your pay stubs are also required to confirm that you can afford the mortgage loan payments.
Affordability
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To qualify for mortgage forbearance, your mortgage loan should fit with within your monthly budget. If you submit documentation of your household expenses vs. your income before your temporary hardship, and the lender determines that you are unable to afford your mortgage, your second request for forbearance may be denied. The lender's goal through forbearance is to allow homeowners a short term relief on mortgage payments. Long-term options are available for homeowners experiencing recurring mortgage problems.
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Term
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One reason the mortgage lender checks whether you can afford your payments is to eliminate the constant need for forbearance. Also, at the end of your loan term, you are responsible for paying back any payments you missed during forbearance. You can repay the money in one large lump sum or add additional money with your mortgage payments each month until the debt is satisfied.
Alternatives
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Lenders are not obligated to approve a second forbearance request. Explore other mortgage assistance options in case your loan is denied. For example, you may be able to modify your loan to reduce payments and add the past due amount to the principal balance of your mortgage loan. Loan modification generally works by extending the life of your loan. Refinancing is also a great option if you have a higher than average interest rate. A permanent change to your loan through mortgage assistance eliminates your need to ask for help from your lender.
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