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Hi there,

My husband lost his job and we were recently granted a forebearance by our mortgage company (Wells Fargo) for four months (no payment of the mortgage until September 2009, when all payments would then be due). Right now, we both have credit scores in the high 700s and have paid our mortgage (all payments) to date. How will this affect our credit (if we sign the forebearance letter and stop paying until September?) Is it the same as just defaulting on the mortgage or does it look better on a credit report? Wells Fargo tells us it will show up on our credit report as a "default" but will have a notation "paying under partial payment plan". Is that better than just not paying? The reason I am asking is that he may have a job by next month in which case we will want to renegotiate our mortgage so we don't want to ruin our credit if signing this letter does that.

Thank you for any fast responses - we have to sign this asap!
Rachel

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Is there a law that requires a lending institution (bank) to report late payments on your mortgage when you enter into a forebearance agreement? My logic is you get dinged for non-payment the exact same for making a reduced payment offered to you from the bank.

Like | Dislike | Share | Posted: Tue, 10/30/2012 - 08:31 | Post subject:

jameshogg's picture
jameshogg | Joined: December 20, 2005 02:58 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Toy,

I don't know about laws but as far as I can understand, the lender can report a forbearance agreement to the credit bureaus and it will affect your credit.

Thanks

Like | Dislike | Share | Posted: Tue, 10/30/2012 - 23:20 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Well since I an not a genie and can't predict what your credit score is, I suggest that you gather the following documents and either get a referal or call a mortgage broker out of your telephone book.

Like | Dislike | Share | Posted: Sun, 06/07/2009 - 11:23 | Post subject:

Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

If you have a 1st and 2nd and default on them both it hurts a lot worse. To give you an idea I stopped paying my mortgage in January with a FICO score of 810. I checked about a month ago and it was hanging right around 600, but they bank still hasn't even filed a notice of default. In my case it shows multiple delinquencies because the first and [url=http://www.mortgagefit.com/second-mortgage.html]second mortgage[/url] are treated as separate defaults. If you only have 1 mortgage the damage may not be as bad. If you have 2 mortgages and foreclose expect any credit cards you have will be canceled as so far 2 out of the 5 I own have been. Expect this even if you have paid the balance in full on that credit card every month for 5+ years. They don't care at all. Right now they see delinquency and hit the cancel button immediately.

Like | Dislike | Share | Posted: Sun, 06/07/2009 - 12:59 | Post subject:

Realgeni's picture
Realgeni | Joined: April 13, 2009 08:03 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

rebecyahoo

Welcoem to forum.

Any payment late by 30 days may not have a mjor impact to your credit score. But it will show up as 30 days late.

But once it crosses the 60 day time frame, then it will start makign soem serious dent to your credit score. And remember it will tsay there for 7 years, which sucks. If you think you will be able to make payment soonand get back on your feet and want to keep the property. just go ahead and make your payments.

Do nto sign anythign for which you regret later.

Good luck and feel free to ask.

Realgeni
-Good credit is easy to achieve, as long as you use it responsibly.

Like | Dislike | Share | Posted: Sun, 06/07/2009 - 16:57 | Post subject:

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