I live in an area hit by Hurricane Irma last September. Shortly after the storm my mortgage lender called and asked if everything was ok, and if I was affected by the storm. How nice huh? I said that we made it through ok, but my wife's business had dropped substantially before and after the storm.
She went on to say that they could offer forbearance on our loan and we could essentially pause making payments until we got back on our feet. This was a welcome bit of relief as we would be having trouble soon if the business didn't pick back up (which later it did not - only this month are we getting back to normal).
So I agreed. I stopped making payments in November 2017. In december I got a late notice. I called them, and before I could even ask, they said I see you are under our forbearance plan. I said "Yes, but I still got a late notice." The operator said, this is normal and you will continue to get them, but you can disregard them. So I did.
You might be thinking, "Oh, this next part is here they actually lied and are now trying to foreclose." Nope. But something that is still pretty fucked up.
We had always planned on selling our house this March even before the storm hit. So we've been working at sprucing up this place after hours when I'm not working.
So this week I started working with a mortgage rep to get a pre-approval for home shopping...
I get my credit checked and my score has gone from a 700 or so in Sept 2017 to a 546. All the agencies see my forbearance as late payments. At no time was I told this during any discussions with my lender. I am livid. When I called them they say they report it as "AFFECTED BY NATURAL DISASTER" and not late. But since payments are not made the bureaus see it as LATE.
So now my plans to sell are completely ruined, I will have a hard time qualifying for anything that isn't shitty deal. If my work were to run a credit check right now - I'd be fired. If I were to be laid off, I probably wouldn't pass a credit check to be re-hired anywhere.
To top this off, my lender offers at the end, to modify the loan to add the missed payments to the end of the note and re-calculate the payment. This MODIFICATION also has a negative effect on your score - so you get screwed TWO TIMES! Unless of course you can pay all your missed payments at once at the end and become current.
TLDR: Unless you plan on living in your house for the next few years and you don't care about your credit - never do forbearance.
Submitted February 13, 2018 at 04:07PM by N_I_N http://ift.tt/2BYu5f1
