Until a few months ago, many Boston condo owners didn’t even know what “forbearance” was. Now, roughly four million home mortgages in America, or about 8% of all home mortgages, are in forbearance. Those four million households with mortgages in forbearance might still not fully understand what forbearance is, but they know one thing: They don’t have to make mortgage payments for a while, and they get to spend that money on other things instead of sending it to the bank.
There are forbearance deals offered by lenders for credit cards and auto loans.
What is a Boston condo forbearance?
When a lender agrees to grant the borrower forbearance, the lender agrees to not exercise its rights when the borrower doesn’t make the loan payments. There is an agreement both parties sign, and this forbearance agreement determines, among other things, the period of forbearance, and what happens afterward. And afterward, those missed payments will have to be made up somehow. Forbearance is not forgiveness.