Can FHA mortgage payments be paused for 12 months? What to know

A viral video circulating online claims that homebuyers of fixer uppers can pause their mortgage payments for 12 months.

However, experts are cautioning homebuyers from jumping on the bandwagon too quickly when it comes to this Federal Housing Authority (FHA) loan.

Why It Matters

Americans are facing a housing crisis as a result of low supply and pent-up demand, causing prices to be unaffordable for the average person.

Climbing prices and high mortgage rates have also prevented many from purchasing their own home, and analysts predict mortgage rates will remain between 6 and 7 percent through the rest of 2025.

What To Know

A viral Instagram video created by Chantry Abbott, who goes by @chantabbott, is one of several claiming that homebuyers will be able to pause their mortgage payments for a year if they purchase a “fixer upper.”

“While everyone is distracted by Elon Musk and DOGE, the real estate market is shifting in ways no one is talking about!” Abbott wrote in his Instagram video.

He goes on to say that homebuyers who choose fixer uppers can delay their mortgage payments due to a FHA program that allows them to renovate before their first bill is due.

“This is a game changer for first time buyers and investors,” he wrote.

“This is HUGE for first-time buyers who want to build instant equity and investors looking to flip or create rental income without the pressure of immediate payments. With home prices still rising, this could be the best way to buy affordably and add value at the same time.”

The program being referred to is the 203(k) Loan Program, which recently increased its payment pause to a full 12 months.

However, experts are warning that you’ll need to be pre-qualified for the loan, and you won’t be able to fully skip payments, just pause them. That means the interest will likely accumulate and be added to your loan balance.

What People Are Saying

Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek: “An FHA 203(k) loan can excuse buyers of fixer-uppers from paying their mortgage for up to 12 months, but only if certain criteria are followed. The program allows up to 12 months for renovations to take place and can also finance up to 110 percent of the home’s after-repair value. Before looking for fixer-uppers, though, make sure you can pre-qualify for this type of loan. Getting a pass from having to make a monthly mortgage payment for 12 months also shouldn’t equate to not having a long-term game plan for paying the property back. You still want to have a strategy for paying off the mortgage over time.”

Title and escrow expert Alan Chang told Newsweek: “Unfortunately, there is no basis in reality for the claim. There is so much misinformation on social media, that I feel bad for the less informed public for the sometimes dangerous statements made… This doesn’t mean that payments can be skipped for a year.”

Kevin Thompson, a finance expert and the founder and CEO of 9i Capital Group, told Newsweek: “I’ve seen references to FHA forbearance options that allow borrowers to pause payments but be careful what you wish for. Just because you’re not making payments for a year doesn’t mean the interest disappears. Instead, it accrues and is added back to your loan balance.

“This means when you resume payments, you’re often paying nothing but interest at first. The missed payments don’t just vanish—they’re deferred, which can significantly increase what you owe over time.”

Nadia Evangelou, National Association of REALTORS senior economist and director of real estate research, told Newsweek: “This type of loan has been around for many years. What’s new – is that HUD extended the period for financing mortgage payments from six months up to 12 months. So, this means that borrowers may be able to defer mortgage payments for up to 12 months – but only if they cannot live in their home (uninhabitable property) during renovations. However, this isn’t a pause of mortgage payments. These payments are added to their loan balance, so their loan will be eventually larger. Thus, this loan helps buyers to have some cash flow during renovations, but they will need to pay these mortgage payments in the long run.”

What Happens Next

The U.S. housing market is only likely to see modest growth over the next year, according to Zillow’s Home Value and Home Sales Forecast. Home prices are anticipated to increase 0.9 percent due to a surge in the number of new listings and inventory levels.

Thompson encouraged homebuyers to carefully consider their options before jumping into any program that appears to suspend payments.

“All that glitters isn’t gold—make sure you fully understand the long-term impact before assuming it’s a free pass,” Thompson said.