Forbearance questions
Does entering in to forbearance adversely affect your credit score?
[{"id": "fmbuptf", "text": "I do not believe so.", "replies": [], "depth": 1}, {"id": "fmbvvj7", "text": "Considering entering into agreements on my portfolio with US Bank and would love to know this as well.  Even if it \"officially\" doesn't impact score, I'm hearing that some lenders have \"unofficial\" policies of not lending to those with a forbearance or deferment history going forward.\n\nI'd love to get a straight answer on this from SFH lenders.", "replies": [{"id": "fmbytry", "text": "This won't have an impact. This is an anomaly and will be viewed as such. You, and almost everyone, will get forbearance agreements.", "replies": [], "depth": 2}, {"id": "fmcd934", "text": "Freddie made a point on our last call to stress to Borrowers that entering into Forbearance with them won\u2019t affect a Borrowers ability to secure financing from them in the future or be a black mark against a Borrower. I don\u2019t know about Fannie though...they seem to be taking a hard line on a lot of things right now.", "replies": [{"id": "fmcrss5", "text": "FNMA is taking a harder stance - Freddie loans will get covered but FNMA isn\u2019t going to give you forbearance on face value. Like if you were coming into this with a 0.2x FNMA is going to credit screen you out but Freddie probably wont", "replies": [], "depth": 3}], "depth": 2}, {"id": "fmdbp2u", "text": "My current and former employers have provided loans to commercial customers in the past that have been in forbearance with their prior lenders. There has to be a story that satisfies the questions that will be raised by the credit folks, because the first reaction will be \"Why are we taking another bank's problem?\"  \n\nThe thing is that given the current pandemic, there is a perfect reason why a forbearance is needed. So I do not expect this to impact you in a year after we are back to normal (hopefully we will be back to normal in a year :) )", "replies": [], "depth": 2}], "depth": 1}, {"id": "fmby3h7", "text": "Any changes due to loan arrangements will be reported to credit agencies, right? If so are there any steps they are taking on these crazy time. Did govt think of all pros and cons of these?", "replies": [], "depth": 1}, {"id": "fmbzjdq", "text": "Most commercial real estate lenders (i.e. 5+ unit multifamily, retail, industry, office, etc.) do not report loan data to credit bureaus, so the loans do not affect your personal score. Consider that many commercial properties are held in business entities with multiple partners.\n\nHowever, if you default and end up with a judgment against you as an individual, that will likely appear in either your credit report or background investigation.", "replies": [{"id": "fmc1dnm", "text": "This is the correct answer. A commercial loan is not reported to the main 3 credit bureaus, in most all cases. \n\nIf you default, and you have a personal guarantee, then you could see something attached to your personal credit report, liens on your home, etc.", "replies": [], "depth": 2}], "depth": 1}, {"id": "fmcul1v", "text": "It\u2019s entirely possible for a commercial loan to show up on your credit report if the property is held in your name or if you are a guarantor for a CRE loan. \n\nA properly negotiated forbearance agreement should not negatively impact your credit.", "replies": [], "depth": 1}, {"id": "fmgz29k", "text": "I do special servicing for cmbs and Freddie debt. I can say for my institution, we never report anything to credit agencies, let alone something as simple as a forbearance in these tough times.\n\nDoesn\u2019t hurt to have an open line of communication and simply ask - but I think you\u2019d be fine.", "replies": [], "depth": 1}]