Comment Initials Forbearance Agreement Template For Free

Forbearance is when your mortgage servicer, that's the company that sends your mortgage statement and manages your loan, or lender allows you to pause or reduce your payments for a limited period of time. Forbearance does not erase what you owe. You'll have to repay any missed or reduced payments in the future.

A forbearance agreement may allow a borrower to avoid foreclosure until their financial situation gets better. In some cases, the lender may be able to extend the forbearance period if the borrower's hardship is not resolved by the original agreed-upon end date.

For example, if your servicer allowed you not to pay your mortgage for six months, at the end of the forbearance period, you may owe all six of your missed mortgage payments in one month.

A forbearance agreement is so called because one party agrees to forbear legal remedies available to it during a certain period of time, so long as certain conditions are met. Whether a lender will be willing to enter into such an agreement and under what term will depend on a number of factors.

A forbearance fee is a one-time payment to one party in consideration for its agreement to refrain, or forbear, from exercising some right for some period of time.

Forbearance agreements typically include a release and waiver of claims against the lender. If the lender breached the loan documents or was liable to the borrower for some other reason, they would require the borrower to release those claims as part of the deal.

Most initial forbearance agreements are scheduled to last 3 to 6 months with renewal up to 12 months. In certain cases, depending on when you began your initial forbearance your total can be as much as 18 months.