As a homeowner, having to face forbearance on a mortgage can feel like it’s your last option to manage the debt that has accumulated because of difficult and unexpected circumstances.
However, forbearance presents opportunities that give you a second chance to get your finances on track. You can sell your home fast during a forbearance on a mortgage and get out from under your mortgage debt with an instant cash offer on your home.
Let’s dig into what forbearance means, when a homeowner is eligible for it, and what the options are for selling a property quickly to pay off mortgage debt.
What does forbearance mean?
Forbearance on a mortgage is when a lender and a homeowner agree to temporarily suspend the homeowner’s payments as an attempt to avoid forcing the home into foreclosure.
Lenders provide forbearance options to prevent foreclosure, as they often lose money from paying costly fees throughout the foreclosure process.
A mortgage lender will grant the homeowner temporary postponement of mortgage payments to help the homeowner get caught up on missed payments caused by short-term financial setbacks, such as loss of a job or a major, but temporary, illness. The likeliness of a forbearance agreement depends on the homeowner’s ability to resume monthly mortgage payments following the temporary forbearance period.
Forbearance terms will vary depending on the lender and your situation, but can involve the homeowner temporarily paying either a reduced payment or no payment. The money owed would potentially be due as a lump sum by a certain date or in larger monthly payments after the forbearance period ends, to make up for missed payments.
Are rental properties or second homes eligible for forbearance?
As forbearance provides an opportunity to correct a financial hardship, it’s helpful to know when it’s an option for homeowners in various circumstances, including those with investment properties.
If a property is owned by Fannie Mae or Freddie Mac, it is often eligible for forbearance, including rental properties and second homes.
However, other loan types such as FHA, VA, or USDA loans are not eligible for forbearance if the property is used as a rental property or second home.
Can you sell a home if you’re behind on your mortgage?
Homeowners in forbearance can often sell their homes if they’re able to pay back the payments that have been postponed once the property sells.
This will depend on whether your house is worth more or less than what you owe on your mortgage. If the fair market value of your home is greater than what you owe on your home loan, you can sell your house and use the profits to pay back your lender.
How an instant cash offer can help you sell your home – fast
With an instant cash offer, you can sell your home within your needed forbearance timeline, allowing you to pay off your mortgage and get out from under the debt of your property.
To provide a solution to a difficult situation, Bolt and Beam can help you through the process of quickly selling your home for cash.
We provide you with information and education so that you can sell your home on your terms. This gives you options that otherwise aren’t available through the more traditional, and sometimes overwhelming, method of listing and selling your home after making repairs, staging your home for showings, negotiating with buyers, and possibly waiting for months for it to sell.
Instead, you provide details about your situation and we’ll analyze your needs and give you information about your home and local market. From there, we’ll provide you with our best recommendations for instant cash offers, along with the pros and cons of each option.
The options for getting an instant cash offer for your home include selling to:
- Investors, or i-Buyers, who provide simple fair offers to homeowners looking to expedite their sales process. These types of buyers include Opendoor, Offerpad, Zillow Offers, and Redfin Now.
- Wholesalers or Flippers, who are local real estate knowledge experts that sell homes that need extensive repair or renovation prior to sale.
- Realtors, who will always be needed for local real estate knowledge to help homeowners maximize their return for their homes.
With these options, you can receive a cash offer for your home within 24 to 48 hours and can close on the sale within as little as seven days.
Bolt and Beam’s service is free to you as we’re paid based on referrals to buyers. For this reason, we only make referrals that we know will be worthwhile for both you and the buyer.
Learn about your options for selling your home quickly
If you’re interested in learning more about getting a fast cash offer for your home, contact us or complete the quick questionnaire below to get started.
We’ll learn about your situation and make the best possible recommendation for selling your home without the hassle of a traditional sale, while helping you get the most out of your property so that you can pay off your mortgage debt.