When Does Mortgage Forbearance End? Your Options 

Mortgage forbearance is an alternative for many homeowners who don’t have the immediate means to make mortgage payments. Through forbearance, mortgage payments are deferred until a later date. At that point, mortgage payments will resume and the borrower pays extra to make up the deferred costs.

However, all mortgage forbearance agreements have strict deadlines. Homeowners must be aware of these deadlines when they sign a forbearance agreement so that they know how much they need to save during the months when their payments are deferred.

Today, let’s break down when mortgage forbearance ends for regular forbearance agreements and for forbearance agreements under the CARES Act, which covered many struggling homeowners during the COVID-19 pandemic. We’ll also explore additional payment options if your forbearance deadline is looming and you won’t be able to make mortgage payments regularly.

Normal Forbearance Timeframes

A normal mortgage forbearance can be extended to a borrower for any number of reasons, including:

  • A sudden loss of employment that leads to financial hardship and missed payments.
  • A sudden medical emergency, which could require funds to be diverted to medical bills instead of mortgage payments.
  • A national or worldwide emergency like the COVID-19 pandemic.

In any event, most lenders will extend forbearance agreements to borrowers for time frames ranging from three months to six months or even up to a year. However, normal forbearance agreements do not go past one year. After this point, the mortgage lender may decide to pursue foreclosure or seek out a different property owner, if the homeowner is unable to pay off the forbearance balance or make modified payments.

The exact time frame depends on the lender, the history they have with their borrower, and the mortgage contract itself. Some lenders are more generous with forbearance timeframes than others.

How To Request a Forbearance Extension

When you are approaching the initial deadline for a forbearance agreement, you may be able to request an extension from your lender. However, extensions are not guaranteed.

To request a forbearance extension, you must contact your lender immediately and explain to them that your financial hardships are continuing for longer than expected. You have to provide proof of your financial hardship to be granted a forbearance. This will also be required for an extension.

Again, the forbearance extension timeframe will vary from lender to lender. Some lenders may only extend your forbearance up to a month. Others may agree to extend your forbearance up to six months. However most lenders have a strict forbearance maximum, beyond which they will not provide additional extensions when the forbearance period ends.

If a lender grants you a forbearance extension, you must sign an additional forbearance agreement and abide by the terms or restrictions included within the document.

CARES Act Mortgage Forbearance Deadlines

The CARES Act was put into action to help American homeowners retain ownership of their homes throughout the ongoing pandemic. While this Coronavirus aid was launched over a year ago, deadlines are now starting to run out for many homeowners who took advantage of the extended forbearance requirements.

In a nutshell, the CARES Act requires mortgage lenders to extend forbearance agreements to their homeowners if requested. Note, however, that this requirement only applies to loans that are backed by the federal government, such as the HUD/FHA or the USDA. It also included any homeowners using VA loans.

If your home is backed by a private lender only, you are not/were not qualified for forbearance and any applicable extensions under the CARES Act.

Furthermore, if your loan is backed by Fannie Mae or Freddie Mac, you may continue to apply for an initial forbearance indefinitely. But you may not be guaranteed approval the same way you will be if your loan is federally backed by one of the above organizations.

Homeowners may still request initial hardship forbearance so long as the COVID-19 national emergency remains. Since the national emergency is still in place on a technical level, initial forbearance requests are still valid.

However, if you have already applied for the mortgage forbearance program initially, you may not apply for forbearance again.

So, what’s the deadline? Any initial forbearance requests under the CARES Act were initially set with a six-month deadline. This remains true today – for example, if you request forbearance in December 2021, your mortgage payment will be due by May or June 2022.

Can You Request a Forbearance Extension? 

Yes. The CARES Act also includes provisions to help Americans recover financially through extensions. The majority of loans can request forbearance extensions of up to 12 months, although some could see up to 18 months of forbearance extension. It depends on a number of factors, such as who backs the loan and when the initial forbearance was requested.

If your mortgage is backed by either Fannie Mae or Freddie Mac:

  • Homeowners can request two separate three-month extensions.
  • The total forbearance period cannot exceed 18 months.
  • All homeowners must have been in active forbearance by February 28, 2021, to qualify.

Meanwhile, if your mortgage is currently backed by USDA, VA, or HUD/FHA loans:

  • Homeowners can request up to two separate three-month extensions for a maximum time of 18 months.
  • All homeowners must have requested forbearance either on or before June 30, 2020, in order to qualify.
  • Furthermore, not all homeowners will qualify for the maximum forbearance time frame.

As you can see, your CARES Act forbearance deadline is heavily dependent on when you requested forbearance initially, whether or not you received an extension, and who backs your mortgage loan.

If you don’t currently know the deadline for your forbearance, contact your lender and ask them. They should have this information on record and easily at hand. If the end of the forbearance period is coming up and you know you won’t be able to pay off the mortgage debt that has accrued, you may have additional options to pursue.

What To Do if Your Forbearance Protection Expires

Once forbearance protection expires, lenders will require mortgage payments to resume immediately. Furthermore, depending on the terms in your forbearance agreement, you may be required to:

  • Make a lump-sum payment of all the monthly deferred payments combined. This could amount to many thousands of dollars for millions of Americans, and it could be hard to meet this amount.
  • Make extra mortgage payments or make higher monthly mortgage payments for several months following the end of your forbearance. For example, if your regular payment is $1000, you may be required to make payments of $1500 per month until your deferred payment debt is eliminated.

Given that forbearance is always requested when a homeowner undergoes financial hardship, these conditions can be very hard to endure. If your forbearance deadline is coming up and you know you won’t be able to make up the deferred payments, you still have several options to avoid foreclosure.

Short Sale

A short sale is a unique type of real estate sale where a house is rapidly sold for less than whatever is still owed on the mortgage. The homeowner sells the property to a real estate investor, to another mortgage lender, or any other interested party.

Why sell the property for less than what is owed on the mortgage? Simply put, because it takes the property off the hands of the lender and the homeowner. The homeowner takes whatever profits are gained from the short sale and puts them toward whatever they owe on their mortgage balance.

Depending on how much remains, the lender may let the homeowner off the hook entirely. For example, if only a few thousand dollars remain on the mortgage agreement, the lender may not require the borrower to pay back the $3000. Instead, they may just eat the loss in order to move on to other contracts.

However, this is not a guarantee. In many cases, the lender still requires the borrower to make good on whatever is left in the mortgage agreement. If $3000 is remaining, as in the above example, the borrower may be required to make monthly payments over time to pay down the amount.

Short sales can only be approved by mortgage lenders. A borrower or homeowner cannot decide unilaterally to go through with a short sale.

Who Should Consider a Short Sale?

A short sale can be a valid alternative to foreclosure. Short sales are much less financially severe or credit damaging compared to a foreclosure. In fact, many short sales don’t have an impact on a borrower’s credit score at all.

Furthermore, some short sales allow homeowners to get out of a mortgage contract they can no longer afford without any extraneous debt. Lenders get to escape the contract as well and can move on to different real estate opportunities. They also don’t have to go through a lengthy and expensive auctioning process, as they would with a traditional foreclosure.

If you think you can sell your home for close to what is remaining on your mortgage quickly, contact your lender about the possibility of a short sale. This circumstance is most frequent when you already have a person or party who you know would be interested in buying the property quickly.

Loan Modification/Refinancing

You may also contact your lender about a loan modification or refinancing agreement. With a loan modification, you and your lender draft a new version of the mortgage contract with different monthly payment requirements, a different term, and potentially different interest rates.

Loan modifications are ideal if you need to make a lower monthly payment because of a reduction in income, the addition of an extensive medical bill each month, or some other reason. Many lenders are amenable to loan modification requests because they continue to receive regular income from the homeowner, just at a lower than usual rate.

Over time, the lender may still receive their full payment for the property, and they don’t have to go through foreclosure. It's important to note that a loan modification only helps with the mortgage but may not be enough to help get all other debts under control, which is why many homeowners end up behind with a modification.

Can Anyone Get a Loan Modification?

That said, loan modifications are not available for everyone. Certain lenders may also not agree to a loan modification if you have already received a loan refinancing offer once or twice in the past. Some lenders may require proof of your income to show that you can pay regular mortgage payments at the new and modified rates before they will offer a new mortgage.

If your current lender is uninterested in a loan modification, you may still have options. You can instead go to one of your lender’s competitors or another mortgage loan provider.

Depending on your credit score and the cash you have on hand currently, they may agree to pay off the current cost of your mortgage and enter you into a new mortgage loan with different rates and terms. Naturally, many of these refinancing options come with increased interest rates or less favorable terms. 

Adjusting or changing the terms of your mortgage loan can still be a good way to keep your home through financial hardship and keep life essentially normal. You’ll still make regular monthly mortgage payments, and your credit score will not take a major hit since you’ll have entered another mortgage contract rather than defaulted on your loan.

It is important to remember that this new mortgage can still go into default if you can’t make the payments on your repayment plan. Lastly, keep in mind that mortgage refinancing or loan modifications often come with extra fees. If you can’t cover these costs, a mortgage loan modification may not be the best choice.

Who Should Consider a Loan Modification? 

A loan modification could work if you received a temporary or permanent reduction in income but can almost make your mortgage payments in their full amounts. In this case, you don’t need a full forbearance or a more drastic alternative.

You can keep your home and continue to make regular payments to your lender. In exchange for lower monthly payments, you are extending the length of your loan term.

Co-Investment with Balance Homes

Balance Homes offers a unique and innovative means to retain their homes even in the face of financial hardship. Through co-investment, Balance Homes pays off your mortgage, helps you consolidate debt, repairs your property, and raises your credit score by paying you cash for a share of your home equity.

In exchange, you pay Balance Homes affordable monthly occupancy payments, with the option to purchase increasing amounts of equity in your home over time or sell or refinance back to a mortgage when you're ready. In this way, you can exit a Balance co-ownership and become the sole owner in your home again.

Alternatively, you can enter a co-investment with Balance Home if your current mortgage is in delinquency or you're having trouble keeping up with your monthly obligations. We even provide certain homeowners up to $50,000 in cash to cover extraneous debts or other financial obligations.

In a nutshell, Balance Homes offers you the chance to take control of your financial security once again with co-investment. You can contact us today for more information. 

Who Should Consider Co-Investment? 

Co-investment may be a valid financial alternative for homeowners who don’t want to leave their current property but have trouble qualifying for a traditional refinance, HELOC, or home equity loan. It may also be a good pick if you need to make lower monthly occupancy payments, but your lender will not agree to a mortgage refinancing process or loan modification.

Try the Homeowner Assistance Fund

The Homeowner Assistance Fund is a nonprofit program worth $10 billion that was created by the American Rescue Plan. The exact fund and plan vary from state to state, but programs are quickly getting up and running across the country.

In a nutshell, the HAF helps borrowers catch up on any missed mortgage payments. In this way, you may not need to pursue forbearance or any other financial alternative above. You can simply apply for the HAF, make up any deferred payments you may have, and gradually pay back the fund over time.

Who Should Consider the HAF? 

The HAF could be a valid choice for homeowners who want to keep their current properties, but need a little help catching up on a handful of delinquent payments, such as between two or three months’ worth of mortgage payments. If you have a significant amount of delinquencies to worry about, another option may be a wiser idea.

Economic Security: Relief Options

In the end, knowing your mortgage forbearance deadline is critical, even if you won’t be able to resume payments right away. By understanding your forbearance deadline, you’ll be able to come up with a plan of action. Then, you can pursue one of the payment alternatives above, like co-investing with Balance Homes.

If you are concerned about falling behind on your payments, always talk to your lender immediately. Again, lenders don’t want to force foreclosure on homeowners. It’s in everyone’s best interest to keep Americans housed and owning property. Contact Balance Homes today for more information and for assistance keeping your home throughout this trying time.


Learn about forbearance | CFPB

CARES Act Forbearance Fact Sheet for Borrowers with FHA, VA, or USDA Loans | HUD.gov

Short Sale (Real Estate) Definition | Investopedia

Homeowner Assistance Fund | US Department of the Treasury