Mortgage on pause, can you purchase another rental?

Question

If you have a property that has qualified to have the mortgage put on furlough (basically paused, with the monthly payments to be added to the end of term) and you have been able to saveoney through other sources.....what would happen to your situation if you then go to buy another rental property.

Would the first property be notified somehow and you then would need to begin paying those mortgage payments again?

Joe Splitrock · Answer

@Michael Dumala you claimed financial hardship. It is a self certifying declaration, so it will raise questions of your financial position. You don't need to explain to me, but be ready to explain to the underwriter.

I warned people to be careful with taking forbearance because of the fine print. There are other rules the government has attached, such as eviction freeze until after you are out of forbearance. You also can't give 30 day notice to vacate for no cause and you can't charge late fees. There is other stuff too that goes beyond the CDC moratorium, so be aware you are playing by their rules now.

Derrick Dill · Answer

Your lender will see a huge red flag that they see your in forbearance, you've elected to not pay your mortgage because you are having financial issues. It will be very difficult to get another mortgage through traditional financing while on forbearance. Will be much easier to buy after forbearance is over.