by Brian Brady
Commercial Real Estate Finance Expert
Structured Debt and Equity
Licensed Real Estate Broker in AL, CA, and FL
One of the most consistent of the “old school mortgage bloggers” is Rhonda Porter in Seattle, writing over on The Mortgage Porter. She offers no-frills information about mortgage markets, the kind of straightforward advice homeowners need. Her blog is almost 15 years old.
I wanted to advise current homeowners why they should not accept the mortgage forbearance program, unless they drastically needed it and regret that I didn’t back in March. The mortgage forbearance program was offered as a “no penalty” break for homeowners– ask to suspend your payments and it’s automatically granted without any hit to your credit score. While that part was true, many of my past clients found out that nobody would refinance their loan to a lower rate while they were in forbearance (it kinda makes sense, right?)
Fannie/Freddie offered specific guidance a few months ago; I’ll let Rhonda explain it:
Fannie Mae and Freddie Mac offered clarity with their new guidelines this week. If you currently have a conventional mortgage, it is a Fannie Mae or Freddie Mac mortgage. Basically, if you opt for the forbearance program that’s being offered due to covid-19, then you may not be able to get a new mortgage until you have have made three months of on-time mortgage payments. If a borrower has stayed current with their mortgage, they may still be eligible for new mortgage. There may be some variances with this depending on what type of forbearance program you have entered into as well as lender underwriting overlays.
