Homeowners need to learn the facts before taking any action related to their homeownership.
The COVID-19 pandemic poses a serious challenge to homeowners who have had their income unexpectedly shut off. However, all Minnesota homeowners should learn the facts before acting hastily with regard to homeownership. Here are the facts for consideration as they stand today (Tuesday, March 31, 2020):
- The Federal Housing Finance Agency has announced that all mortgage loans owned by Federal Home Loan Banks (Fannie Mae, Freddie Mac, etc…) will offer temporary relief to those impacted by the Coronavirus whose ability to pay their mortgage is impacted. These individuals will be eligible to temporarily delay making their monthly mortgage payments. During this delay there will be no late fees incurred; delinquencies will not be reported to credit bureaus; and foreclosure and other legal proceedings will be suspended.
- In addition to the loans covered above, most if not all consumer-facing financial institutions also are offering relief, including mortgage relief where applicable, to consumers affected by the Coronavirus. Contact your lender to learn more.
- In order to take advantage of any of these relief provisions, consumers must reach out to their lenders to discuss their situation and enroll in these special programs! Missing a mortgage payment without reaching out to your lender will not automatically enroll you. Checking the lender’s website first may be helpful as some have more self-serve functionality available than others.
- These temporary relief programs are just that – temporary relief. They should be utilized only when you are at risk of defaulting on your mortgage. Any payments delayed will still need to be made eventually, likely with interest. When speaking with your lender, make sure you understand specifics like this, keeping in mind that additional government relief to consumers as well as to banks may further impact things to the positive down the road.
- Protect yourself from scams and scare tactics. Never pay for mortgage relief! Scammers and flippers are working overtime during this period of uncertainty and anxiety. Here’s some helpful information on avoiding scams from the Federal Trade Commission. For trusted information and advice, seek the expertise of a Homeownership Advisor by clicking here. These services are free and deliverable via phone or video conference.
The bottom line for homeowners is that banks are expecting many consumers, through no fault of their own, to understandably have trouble in the short term keeping current on their mortgages. While it is imperative that consumers reach out to their lender and discuss their situation, the banks are poised to assist you during this difficult time.