Sorry if this is a dumb question but I can’t quite find any answers or experiences on the googles. My property taxes went up a bit, but the escrow increased by about 400 a month. We were already sweating about the wiggle room but this is kicking our butts. I have seen countless articles that say to call the lender and talk about options, etc. I’ve read about the possible option to move a payment to the end of the loan, and even just one month of this would allow us to breathe a little easier (and replenish our emergency fund). So my questions are:
Does anyone have any experience with pausing mortgage payments and having them added to the end of the loan period? One of the reasons we got behind is because we all got covid and missed some work (3 kids and me and wife).
Does the call alone to ask about options trigger any sort of red flag or credit issues? I just want to talk to someone but I’m a bit nervous it will screw us over just to even ask.
The call alone won’t trigger anything, I would reach out to the servicing department if you current lender and explain the situation and ask what options are available. They get similar calls all the time and you’d be surprised about what they can offer to help.
@Marley
Thanks for your response! Any hints at what I’d be surprised about? Any stories you’ve heard? I’ve avoided calling until we absolutely needed to with no other choices, but I have a feeling I should have earlier.
@Lian
Your taxes likely increased $200 a month. But your are $200 a month in the hole from last year thus the $400 increase. The good news is next year your escrow payment should drop down (lots of state specific stuff there as well)
Give them a call and see what they say. I generally try to just pay my tax increase in one lump sum. They may be able to offer you options though since you are double paying for the taxes right now. Maybe they can stretch the catch up amount greater than 12 months for you etc.
@Ollie
Posting this for anyone else looking for help, I called them and they offered 2 months of loan forbearance. I only needed one so I paid the one part back right away. Now the second month I’ll have the ability to replenish emergency funds and give us a buffer. They said at the end of the 2 months they can further determine eligibility for deferment or a loan modification. I know we took a slight credit score hit for this but I feel like I can breathe after a couple of years of stress.
@Lian
This should be an extreme last resort. And if you have to do it, do it. But you are locking your self out of future refinance or sale/purchase opportunities by doing a forbearance or loan modification. The rules are a bit of a crap shoot after all the Covid forbearances changes, and FHA has opened up new loss modification problems, but they look like they will prevent future lowering of the payment via a refinance if that is something you were looking at.
@Ollie
Interesting. I didn’t know that. It really is kind of a last resort though. I wasn’t going to be able to pay the full amount next month already. But I did NOT know about the refinance thing. You literally just can’t refinance after this? We will be in this house for a long time but if we can’t refinance if like the rates go lower? We are at 5.15% right now so better than usual but we missed out on the crazy 2-4% days.
@Ollie
Sorry to post so much I called them back to ask about this and they said they allow refinancing after 6 months of on time payments after forbearance PLUS the CSR was going to double check if I needed to pay off the forbearance amount as well, which in my case is one month of mortgage. Should be in good shape pretty quickly! Thanks for your response BTW!
@Ollie
yeah I hear ya. Im sure ultimately they are making extra money off me. I’ve weighed the options for awhile now and I think this will work for me and my family. I’ll be on the lookout though for all of this and thanks again for your help.
I called them back to ask about this and they said they allow refinancing after 6 months of on time payments after forbearance PLUS the CSR was going to double check if I needed to pay off the forbearance amount as well, which in my case is one month of mortgage. Should be in good shape pretty quickly! Thanks for your response BTW!