Coronavirus Mortgage Relief Options

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Real Estate

Coronavirus Mortgage Relief Options

Wondering what to do to obtain mortgage relief? Want to know your options?

If the Coronavirus is impacting your finances and your struggling to pay your mortgage as a result, this blog is for you.

Federal and state governments are creating plans to assist struggling homeowners during these trying times. You need to know your options.

The Coronavirus Aid, Relief, and Economic Security Act (CARES) Is a new federal law that has two protections in place for homeowners with federally backed mortgages.

1) A foreclosure Moratorium

2) A right to forbearance for homeowners with federally backed mortgages.

The first steps:

Assess your financial situation. If you can pay your mortgage, pay your mortgage.

If you can't pay your mortgage or can only pay part of the amount due then you'll need to call your mortgage service provider right away. Be prepared to be on hold for some time. The coronavirus is impacting every industry and employees are limited in quantity and many of them are working from home with limited resources. Take the time to look on their website first to see if you can get answers there. If not and you must call be prepared, have your current statement handy, be prepared to explain why you can't make your payment, and details about your income, expenses and assets. 

CARES ACT Relief Options Available

If your mortgage is federally backed by Fannie Mae or Freddi Mac you have two mortgage relief options under the CARES Act:

1) Your Loan Servicer may not foreclose on you for sixty days beginning on March 18, 2020. The CARES Act prohibit's servicers from processing foreclosure against you, or from finalizing a judgement sale during this time.

2) If you can show that you're experiencing a financial hardship from the impact of the pandemic you have a right to request a forbearance for up to 180 days. You also have the right to request another forbearance for an additional 180 days. You have to contact your service provider to request your claim of a pandemic-related financial hardship.

If you have a Fannie Mae or Freddie Mac backed mortgage

* You won't be charged late fees

** your credit will not be impacted

*** Foreclosure or other legal proceedings will be suspended

If your mortgage is not backed by the federal government

If your mortgage is not federally backed, contact your lender or service provider to find out what they may have in place to assist you. Specifically ask what options are available, forbearance, loan modification etc... Can they waive late fees? Also, check with your local state and government websites to find out what may be available as all providers are encouraged to work with homeowners during this unprecedented time of hardship.

Be sure to protect yourself

Once you have the assistance you are looking for be smart, get it in writing. I can't stress this enough, verbal is not enough to hold up should a problem arise. Once you have an agreement in place pay close attention to your monthly statements. Keep an eye on your credit and once your income is restored contact your service provider and resume your payments. Save any money you can so that once the relief is exhausted you'll have an easier time keeping your mortgage current in the future.

Know the Terms

Will the payments become due all at once, at the end of the loan term? Be diligent in educating yourself so there are no surprises later.