Forbearance vs. Refinance

The current market has raised some questions surrounding mortgage forbearance and refinancing your home. We have teamed up with our preferred lender, First State Bank, to discuss the difference between the two.


Forbearance allows you to hold off on mortgage payments. In some cases you can skip payments for three months or potentially longer, but this comes with credit ramifications later on. You will still owe the money at the end of the forbearance period and in most cases, with interest. Not all forbearance agreements are the same, so be sure to negotiate your payment plan option for after the forbearance period.


Refinancing your home allows you to adjust the rates of your payments. This will allow you to still skip a payment and can save a tremendous amount of money over the life of the loan—a much better investment into your future. If you can refinance, it may be a better option, especially in the long run.

Both programs are intended to help homeowners, but before you make any changes, be sure you have a full understanding of each payment plan. Knowing your rights and options as a borrower will help you make a smart decision when it comes to choosing between forbearance and refinance.

Let us help you find the best solution—contact your local Arterra Advisor or call us at 248-212-0751.




425 S. Main Street,

Rochester, MI 48306



17370 Hall Road

Clinton Township, MI 48038

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