Mortgage Forbearance & Deferral

Are you falling behind on your mortgage payments due to unforeseen financial hardship? It's still possible to avoid foreclosure—and you may be able to stay in your home while preserving your hard-earned equity. If you're ready to take your next steps, here's everything you need to know about loan forbearance and deferral. You can always contact our team with any questions, too! 

What's the Difference Between Forbearance & Deferral?

Simply put, mortgage forbearance and deferral both allow homeowners to temporarily put off their payments if they're experiencing financial difficulties. While both terms are often used interchangeably, there are still a few key differences to consider before making a decision.


Forbearance lets homeowners who are (or will be) delinquent on their mortgage put off payments for a specified amount of time. During this period, your loan will still accrue interest, and you're required to make up any missed payments after the forbearance period ends.

Typically, a lender will approve a forbearance period ranging from a few months up to a year. You may also have to agree to a repayment plan before your lender allows you to defer payments.

Forbearance is a good solution for anyone experiencing short-term financial difficulties. It also won't have a significant impact on your credit, especially compared to foreclosure.  


Like forbearance, deferral (also called deferment) is a program offered by most lenders that allows homeowners to temporarily put off their mortgage payments. However, when you agree to a deferral, your missed payments are automatically added onto the term of your loan.

While this technically means you won't have to repay your lender right away, you'll have to make up these payments by the end of your loan or whenever you sell your home.

Deferment is a bit more flexible than forbearance, and you can often pay off your debt in a lump sum or through installments. Some lenders allow you to combine deferral and forbearance to create a financial recovery plan that's custom-tailored to your needs. 

Leverage Your Equity

As property values continue to rise in the Triangle, you may have more equity in your home than you might expect. If you're considering forbearance or deferral, it's possible to leverage your equity by selling your current home and using the profits to make up any deferred payments. 

Not sure how much your home is worth? Provide your address, and we'll perform a full analysis to determine how much you could make if you listed right now. It's fast and free, and there's no obligation!

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Avoiding Foreclosure

Foreclosure doesn't just force you to give up your house—it can also permanently damage your credit, and you'll still have to pay taxes on any debt that's forgiven by your lender. Aside from forbearance and deferral, there are a few other ways you can avoid foreclosing on your home.

Before you fall too far behind on your payments, reach out to your lender to explore your options. They may be willing to help you refinance your loan or put you on a payment plan. The federal government also offers a variety of resources—such as the Making Home Affordable (MHA) Program—that can help you get back on your feet.

Selling your home can help you pull out any remaining equity and pay off your debt to prevent foreclosure. If you need to sell quickly, it might be advantageous to work with a cash investor or an iBuyer. Here at Linda Craft Team Realtors, we have our own in-house Cash Offer Program that can help homeowners in this situation.

You Have More Options Than You Think

As we continue to navigate these uncertain times, it's important to evaluate all of your options before turning to foreclosure. Unlike during the 2008 housing crash, today's homeowners have more equity in their homes, and there are additional protections in place to help you achieve financial stability.

Before you miss any payments, be sure to contact your lender to see what they can do to help. Because they lose money on a foreclosure, they'll likely be willing to work with you. If you have a government-backed loan (such as a VA, FHA, or Fannie Mae mortgage), you may be automatically entitled to a forbearance plan through the CARES Act.    

Behind on Your Mortgage Payments?

If you're falling behind on your mortgage payments and need help understanding your options, we're here for you every step of the way. We'd be happy to explain forbearance, deferral, or help you come up with a plan to maximize your existing equity. Feel free to give us a call with any questions—we're always here to offer our 350+ years of expertise!