Work Out a “Forbearance Plan”
If you are unable to make your monthly mortgage payment, the mortgage company may extend forbearance by agreeing to suspend payments. They might also agree to accept partial payments for a limited period of time until a repayment schedule is agreed upon.
Forbearance is a formal, written agreement between you and the bank that reduces or suspends monthly payments for a specified period of time. This means that, for a period of time, you would either pay only a portion of your regular mortgage payment or may not have to make payments at all.
At the end of the agreed-upon period, you would then be required to resume regular monthly payments, as well as pay additional funds to make up for the past due amount. During the time that the payments are either suspended or reduced, you would have the opportunity
to resolve the financial hardship you are facing. This agreement leads to reinstatement of
the loan. There is no maximum duration, but the maximum arrears due may not exceed 12 months arrears of principal, interest, taxes, and insurance. The bank might consider making this option available to you if you have recently experienced a decrease in your income due to unemployment or illness, among other things.
In addition, lenders may agree to wait before taking legal action against you, effectively allowing you time to work out a repayment plan that is affordable for you.