The devastating economic impact of Covid-19 has left millions in financial distress. If you are one of the many struggling with late payments, you may be frantically searching for any way to stay afloat. That’s where mortgage forbearance comes into play.

Though forbearance offers a gleam of hope in an otherwise dark situation, it’s not your golden ticket to financial freedom. To truly understand if this is the right option for you, you must first consider all the pros and cons of mortgage forbearance. 

What is Mortgage Forbearance?

Mortgage forbearance was conceived under the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020. It provides temporary relief to those with federally backed mortgages who are unable to make their payments. 

The program completely suspends mortgage payments for 180 days (6 months), which can potentially be doubled for a total of 360 days. It’s important to note it only suspends- not forgives- home loans. After the given time period ends, the missed payments are expected to be redeemed. 

There are a number of different repayment programs to assist in the process of compensation, depending on your individual mortgage forbearance loan.

Deferring your mortgage payments probably sounds like a tempting idea in any situation, let alone the coronavirus-induced economic disaster in which we find ourselves today. However, it’s best not to jump into a binding commitment. Let’s first weigh the pros and cons of mortgage forbearance to truly determine if it’s in your best interest to undertake. 

The Pros

  • If you are on the verge of foreclosure, mortgage forbearance will aid you in keeping your home. 
  • Unlike more traditional loans and temporary relief aids, there is no interest accrued in mortgage forbearance. In other words, there are no penalties in exchange for the help offered. You will only have to pay back the original amount of your payment.
  • Though mortgage forbearance shows up on credit reports, it will still save your credit from foreclosure or late payments- both of which dramatically decrease your score. 

The Cons

  • Good budgeting of your money is a must if you decide to take on mortgage forbearance. Accepting the temporary relief aid means also acknowledging the responsibility that you will pay back the full amount in the future. 
  • You won’t be able to refinance your mortgage until you repay the amount in full if you decide to take on forbearance. If you can afford to make your payments now, and are looking to refinance in the near future, you might save more money by turning down forbearance. 
  • Mortgage forbearance negatively affects the housing market as a whole. Since lenders are investing their money to those in need, it leaves them short on cash to loan to everyone else. This means mortgage prices and credit requirements will rise, subsequently making it harder for the public as a whole to finance a home. 


Mortgage forbearance is a good short-term option for those who are in an otherwise impossible financial situation. Naturally, mortgage forbearance is a life saver if you are about to foreclose and lose your home. But considering the pros and cons of the program, if you are able to fulfill your payments, it’s probably best to do so. Cut back your spending in other areas of your life while paying your mortgage now. It will ultimately give you more financial freedom in the future.