Here’s how homeowners in forbearance can purchase or refinance again.

If you were enrolled in a forbearance plan, can you buy or refinance now that you’re out of it? You can, but there are some rules you need to know. Every lender has slightly different standards.

If you’re still in forbearance, you cannot buy or refinance. A forbearance is a financial hardship, so why would they give you another loan if you can’t pay your first one?

If you were in forbearance and now owe back payments, you have a couple of different options. First, you can pay it back in full. If you can’t, they can put the balance on the end of your loan. It’s like a “second” mortgage that sits at the end of your current mortgage. When you refinance or sell, you’ll have to pay it back in full. You also have the option to set up a repayment plan with your lender that slightly increases your payment each month.

“Mortgage brokers can help you shop around for different lenders.”

After you’ve figured that step out, you’ll be able to refinance again. Most lenders have a three-month rule, meaning you have to have made three consecutive monthly payments to qualify for another purchase or refinance. FHA, VA, and conventional loans each have different requirements and so do mortgage lenders. Mortgage brokers can help you shop around for different lenders with different products and rules.

If you have any questions about your situation, forbearance, or mortgages in general, don’t hesitate to reach out via phone or email. I look forward to hearing from you soon.