Mortgage Payments and COVID-19
During this unprecedented COVID-19 crisis, all areas of American life have been affected. Many workers have lost their jobs, or have had to receive reduced salaries or furloughs. In other cases, businesses have had to completely shutter their doors for an indefinite period of time. In this time of economic uncertainty, many homeowners are concerned about making their mortgage payments on time.
Some lenders are telling their borrowers that while they are allowed to stop making payments on their mortgage for up to three months, they will have to repay that amount in a lump sum in the fourth month. In most cases, this is not completely true. It is important that you look at your exact mortgage and make a determination if it is a federally backed loan. For example, the federal government has made it clear that for any borrower that has a mortgage through Fannie or Freddie home loans, no lump sum of missed payments will be required following any pause in payments due to the coronavirus. In some cases, a homeowner may be able to actually skip mortgage payments for up to a year, depending on the facts and circumstances of their situation.
Specific options were created in order to provide financial relief to homeowners during natural disasters or crises and were created by the Federal Housing Finance Agency (FHFA). The FHFA wants to ensure that victims of disasters (such as the COVID-19 virus) would be able to continue to keep their homes with minimal amounts of documentation or paperwork. In fact, the options available to homeowners under FHFA regulations actually allow homeowners to choose these options without any out-of-pocket fees or negative effects on their credit reports. It is important to note that you are not allowed to simply stop making payments. You must contact your lender and explain how you are experiencing substantial financial hardships as a direct result of COVID-19.
Let Us Help You Today
At last count (which will probably continue to grow), over 26 million people have been laid off or furloughed since the middle of March 2020, due to the coronavirus crisis. If you are unable to return to work, or lost your job due to COVID-19, you are likely facing astronomical debts with no continued income. If you are facing an inability to pay your mortgage or any other bills, and are considering filing for bankruptcy, visit with an experienced West Palm Beach bankruptcy attorney at Kelley, Fulton & Kaplan at 561-264-6850 today for a free consultation to help you understand which debts may be discharged in your personal bankruptcy and how the discharge of those debts may give you the financial relief you need to continue to pay your mortgage.