Key Takeaways: You Can Sell Your House During Forbearance
The COVID-19 pandemic has brought many challenges and uncertainties to the housing market. Many homeowners have found themselves struggling to make their mortgage payments and have turned to forbearance as a solution. Forbearance allows homeowners to temporarily pause or reduce their mortgage payments, providing much-needed relief during these difficult times.
But what happens if you need to sell your house while in forbearance? Can you still put your home on the market and move on to the next chapter of your life? The short answer is yes, you can sell your house during forbearance. However, there are some important things to consider before making this decision.
You Are Still Responsible for Repaying Your Home Loan
First and foremost, it’s essential to understand that forbearance does not mean forgiveness. While your mortgage payments may be temporarily reduced or suspended, you are still responsible for repaying the full amount of your home loan. This means that any missed payments will need to be paid back eventually.
If you are planning to sell your house during forbearance, it’s important to keep this in mind and make sure that you have a plan in place to cover any missed payments. This could include using the profits from the sale of your home or working out a repayment plan with your lender.
Consider the Value of Your Home
Another important factor to consider is the value of your home. If the value of your home is greater than the amount you owe on the loan, you may be able to sell your house and use the profits to cover the payments you missed while in forbearance. However, if the value of your home has decreased, you may find yourself in a more challenging situation.
In this case, you may need to work with your lender to come up with a repayment plan or consider other options such as a short sale. It’s important to consult with a real estate agent and financial advisor to determine the best course of action for your specific situation.
Refinance Your Mortgage
If you are struggling to make your mortgage payments, refinancing your home loan may be an option to consider. Refinancing involves replacing your current mortgage with a new one, often with more favorable terms such as a lower interest rate or longer repayment period.
However, it’s important to keep in mind that refinancing while in forbearance may not be possible. Lenders typically require borrowers to be current on their mortgage payments before approving a refinance. If you are considering this option, it’s best to speak with your lender and a financial advisor to determine if it’s the right move for you.
The Importance of Timing
Timing is crucial when it comes to selling your house during forbearance. It’s essential to communicate with your lender and make sure that you have their approval before putting your home on the market. Some lenders may have specific requirements or restrictions for homeowners in forbearance who are looking to sell their homes.
Additionally, it’s important to consider the current state of the housing market. While the market has remained strong during the pandemic, it’s always best to consult with a real estate agent to determine the best time to sell your home. This will ensure that you can sell your house for the best possible price and cover any missed payments during forbearance.
In Conclusion
In summary, you can sell your house during forbearance, but it’s important to carefully consider the implications and have a plan in place. Make sure to communicate with your lender, consult with a real estate agent and financial advisor, and carefully assess the value of your home before making any decisions. With the right approach and timing, you can successfully sell your house and move on to the next chapter of your life.
