In our last post, we discussed the different types of plans and options for mortgage loan borrowers during the coronavirus pandemic. Let’s run through those real quickly –
Getting a mortgage loan modification could mean extending the length of your term, lowering your interest rate or changing from an adjustable-rate mortgage to a fixed-rate loan. Terms of your modification are up to the lender. The outcome is typically lower, more affordable monthly mortgage payments. As foreclosure is a costly process for lenders, many are willing to consider loan modification as a way to avoid it. [Consumer Finance]
If you need to pause (suspend) or reduce your mortgage payments while you regain your financial footing, you can talk to you lender about forbearance. [Consumer Finance]
In the case of deferment, lenders will often times allow customers to repay the money back over time, or add it to the end of the loan period. [Realtor.com]
Foreclosure is a legal process by which a homeowner fails to pay their mortgage and forfeits all rights to the property. If the outstanding debt can not be paid (or the property can not be short sold) the property then goes to a foreclosure auction. If it is not sold at auction, the lending institution is legally entitled to take possession of it. [Zillow]
Where do you even begin?
Who services your mortgage? Start by contacting your mortgage lender – the company that you send your mortgage payments to every month. If you’re unsure, click here to figure out who your lender is.
Is your mortgage federally backed? Under the CARES Act, your mortgage is required to be federally backed. Below are the government agencies available for you to look up your loan information ––
- U.S. Department of Housing and Urban Development (HUD)
- U. S. Department of Agriculture
- Federal Housing Administration (FHA) 877-622-8525
- U.S. Department of Veterans Affairs (VA)
- Fannie Mae
- Freddie Mac
If you’re looking for a great list of resources available to you and your family during this time, click here.
Questions about your loans, moving or any other real estate-related questions? Email us and we’ll be happy to help.