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Michelle discusses the forbearance agreement offered during the pandemic, where mortgage lenders provided up to 12 months of missed payments. She clarifies that forbearance does not mean forgiveness and payments need to be repaid. Options for repayment include a lump sum, extended payment period, or a second lien on the house. Lenders are now offering loan modifications for those who missed payments, so contacting your lender is advised if this option was not previously offered to you.