Mortgage Forbearance Covid-19 – What you need to know

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Are you experiencing income loss because of the COVID-19 pandemic? Have you been running around in circles trying to find ways to pay your mortgage and find financial assistance in the current situation? Worry no longer because you may be able to get help through the CARES Act allows borrowers to have a mortgage forbearance in the time of coronavirus. CARES Act allows borrowers to suspend mortgage payments up to 12 months with no late fee charges and it will not affect your credit rating as well. Another Coronavirus assistance information you need to know is that evictions and foreclosures will be suspended for at least 60 days. What is mortgage forbearance In layman’s terms, mortgage forbearance in COVID-19 means that the payments of your federally backed up mortgage can be paused for 180 days and can be extended for another 180 days as well. This is a COVID-19 financial relief that is offered to affected citizens. If you have loans insured by the Federal Housing Administration (FHA) or mortgage guaranteed by the Department of Veterans Affairs (VA loans) or Fannie Mae loans, then you can apply for mortgage forbearance. Mortgage guaranteed by the Department of Agriculture, properties insured by the National Housing Act section 255, and section 184 or 184a of the Housing and Community Development Act of 1992 can also apply. How to apply for mortgage forbearance If you are a borrower with a federally-backed mortgage the first thing to do is to talk to your service provider and tell them that you have been directly affected financially by the COVID-19 pandemic. If you are a landlord who owns at least 5 units and has been faithfully paying until Feb. 1, 2020, you can also submit a request to your loan servicer. Even if you have reached the end of the terms of your forbearance period, ask your servicer if you qualify for additional assistance as there are other options that can be made available for you. One option if the possibility of modifying your loan by reducing your monthly payments. Remember though, forbearance does not mean that your mortgage is forgiven and forgotten. You still owe the lender the same amount of money and interest, forbearance simply means that the lender gives you more leeway for repayment for a limited amount of time.