How Do I Sell My House in Forbearance?

0.7% of all mortgages are currently in forbearance. Inflation, interest rates, and a poor economy have caused many homeowners to get behind on their mortgage payments with limited options. Lenders have responded by accepting more applications for forbearance to help homeowners ride out the storm of financial hardship. 

However, forbearance will not help many homeowners catch up on their mortgage payments. Instead, it may delay an inevitable foreclosure. 

If you are a homeowner behind on your mortgage payments and your home is currently in forbearance, you can sell your house right now for cash to a company that buys homes. Selling your house as-is for cash allows you to get out of your mortgage without causing you to go into further financial hardship. Your credit also remains intact so that you can buy another home.

What Is Mortgage Forbearance?

Mortgage forbearance occurs when the mortgage lender postpones your loan payments temporarily. 

Lenders and other creditors grant forbearance as an alternative to forcing a property into foreclosure or leaving the borrower to default on a loan. The companies that hold loans and their insurers are often willing to negotiate forbearance agreements because the losses caused by foreclosures or defaults typically fall on them.

Forbearance gives you, the debtor, extra time to repay what you owe on the mortgage loan. It helps and benefits the lender, who frequently loses money on foreclosures and defaults after paying the fees. So, it creates a win-win between you and the mortgage lender. 

Can I Legally Sell My House in Forbearance?

The answer is yes. 

If the value of your house exceeds the loan balance, you should be able to sell your house as-is for cash while in forbearance. The main difference is that you must pay the lender any missed or deferred payments from the sale proceeds.

Selling your home in forbearance could be more complex in cases where you owe more on your home than it's worth. You have two options to sell if you can't pay the difference out-of-pocket between the mortgage balance and the home's value. 

A Cash Home Sale My be Your Best Option

Even if the value of your home is less than the loan balance, you may still be able to sell your house if you do a cash home offer. What is a cash offer?

In a cash home offer, a house-buying company makes an offer on your house and agrees to pay cash for the house as-is. There are several reasons why a cash sale is a good option during forbearance.

You Can Sell Your House for Any Reason

A cash home sale gives you more flexibility to sell your house quickly without spending much money. If you're applying for forbearance, you are going through financial hardship. A cash sale eliminates selling costs, allowing you to sell your house for any reason - forbearance, foreclosure, bankruptcy, late mortgage payments, etc.

You Can Save Your Credit

Once you have late mortgage payments, your credit score can start going down. Your score may only drop a few points if you catch your payments during forbearance. However, if you can't catch up and your house goes into foreclosure, or you file bankruptcy, it could ruin your credit score. If you sell your house in forbearance, you could save your credit, which could help you buy another house down the road.

You Can Sell Your House Fast

One of the reasons a traditional home sale may not be feasible is because it can take you 60 to 90 days to find a buyer. Plus, you'll spend time making home repairs and going through a long closing process. If you're in jeopardy of losing your house, you may not be able to wait that long. In a cash sale, you can sell your house in forbearance within two to three weeks. 

Sell My House in Forbearance

If you need to sell your house in forbearance, contact Local Guy Buys Houses. We can assess our house, make a fair cash offer and close the sale in as little as seven to 21 days. Let us help you get out of your mortgage quickly. Call 855-205-5999 to get a fast cash offer.