12 Month Deferral Mortgage

Idea for 12 Month Deferral Mortgage

You’ve heard of student loan deferral when adults go back to college, but what if you could defer your mortgage. Yes, that’s right…your mortgage. What if you could defer your mortgage for one year? Yes, that’s twelve whole months of no mortgage payments. Twelve months of not thinking it’s the first and I have to pay the mortgage. Twelve months without the statement my mortgage is due on the 1^st and late on the 15^th repeating in your head. Twelve months of did I make my mortgage payment yet. Twelve months of I hope my mortgage payment was received on time.

There is a company in California called Mortgage Payment Deferral, Inc. that offers such product. In 2006, the only lender licensed to offer 12MoDef is Harbinger Mortgage Solutions, a licensed mortgage broker located in Northern California. Mortgage Payment Deferral. Inc’s goal is to offer this product nationwide in 2007.

12 Month Deferral Mortgage Defined

12MoDef works by setting aside some equity of a home into a trust account for the benefit of the homeowner. The appointed trustee ensures that the mortgage payment is made to the correct lender each month. A monthly statement is given to the homeowner which combines their current mortgage statement and trust account statement. During the payment deferral period, the homeowner has three advantages:

1. keeps more of their income each month
2. guaranteed on-time mortgage payments
3. earns an aggressive rate of interest on the money in the trust account

At the end of the deferral period, the trust account is closed. The borrower is given all of the earned interest and they resume making their mortgage payment.

Reasons for 12 Month Deferral Mortgage

• making job changes
• starting families
• struggling with a new business venture
• meeting the monthly financial burden of their mortgage payment AND credit card debt
• welcoming a new addition to the family
• selling your house
• paying down credit card debt
• taking a vacation
• handling a medical emergency
• getting life under control
• taking advantage of “maxing out” 401K contributions for retirement age adults

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