A.A forbearance agreement is an arrangement between a lender and a borrower whereby the lender agrees to stop the foreclosure process in exchange for the borrower’s promise to catch-up on its payments by remitting payment of 1.5 to 2 times the monthly mortgage amount until all of the arrearages have been paid. Some lenders are willing to enter into a forbearance agreement when presented with evidence that the homeowner's inability to pay was temporary and ability to pay has been restored because a slow performing loan in today's market is preferable to another foreclosure (non performing asset) on the books.
