How to Prevent a Covid-19 Related Foreclosure
Foreclosure is generally a long process and homeowners shouldn’t panic if they can’t afford to make payments during the COVID-19 outbreak. Always remember that this is a widespread, national problem and many homeowners are faced with the same issue.
Due to the current situations at hand, you might be forced to ask questions like;
- I’m I still required to make mortgage payments?
Yes. As of now, there are yet no rules that ask homeowners to stop paying mortgages. In case you’ll be having problems catching up with your payments, try to contact and work with your loan provider. You might be lucky to get a forbearance that allows you to suspend mortgage payments for an agreed-upon time.
Are you unable to keep up with your mortgage payment due to COVID-19 related circumstances or you are currently facing foreclosure? Get in contact with your lender and notify them of what’s going.
For Homeowners with reduced Income
Are you an owner of a single-family home or a condominium? Are you wondering if you can get any COVID-19 related help to help with mortgage payments and stop foreclosure?
- Mortgage Assistance: There are several potential organizations out there funding providing funding to assist homeowners negatively affected by the Covid-19 pandemic. Homeowners with reduced income may qualify for mortgage relief. If your income is less than 50% of area median income, you may be qualified for up to $4000 in mortgage assistance from the RAFT program in case you last income due to the Coronavirus outbreak.
The federal Coronavirus Aid, Relief, and Economic Security (CARES) Act assists some homeowners experiencing financial hardship either directly or indirectly impacted by Covid-19. The Act includes authority allowing financial institutions to provide temporary mortgage suspension (forbearance) on federally owned or mortgage loans with federal backings should your mortgage qualify and should you need such assistance. Let it be known that when granted a forbearance, you will be required to make up the suspended payments either after the forbearance or at a later date as agreed.
- First, your lender or loan provider will not foreclose on you for 60 days after March 18, 2020. The CARES Act strictly prohibits loan providers from taking on a judicial or non-judicial foreclosure against you, or from passing a foreclosure-related judgment or sale during this time given.
- The next was for those with financial hardship instilled by the coronavirus pandemic. The CARES give you the right to request a forbearance for up to 180 days. You are also given the right to request an extension of another 180 days. Before this is done, you’ll have to contact your loan provider to request this forbearance. There’s generally no extra charges, penalties, or additional interest beyond scheduled amounts added to your account. No other documents are required to be submitted to qualify for this other than a valid claim to financial hardship due to the pandemic.
- Foreclosure Protection: The foreclosure protections made available to residential property owners who are unable to keep up with their mortgage payments due to the coronavirus pandemic depends on your loan provider and what entity owns the mortgage. It is advisable to reach out to your loan provider to checkout and see if there’s some sort of foreclosure protection policy they offer. These policies are numerous and evolving and if your mortgage company says they have no programs in place that you qualify for, do not panic. You are not alone in this crisis, there numerous homeowners across the country with the same issues so these programs are frequently changing and you may be able to find one within a week or two.
How do I Request a Forbearance or Mortgage Relief?
You’ll need to reach out to your loan provider to request a mortgage. To ensure that you’re ready for the conversation with them, we’ve put together some information to help you prepare for it.
- Call your Servicer: You may have to stay on the line for a while before getting to speak to your mortgage servicer since there’re a lot of people facing the same issues right now.
Be prepared with the following questions to ask and be sure to check out their website before calling to see if there is a list of information provided or if you can apply online.
Get your account number and ready to go.
For mortgages covered by the CARES Act, all you have to do it explain that you have a pandemic related financial hardship.
- What questions should you ask?
- Do you have any options to help suspend or temporarily reduce my payments?
- Do you offer any forbearance, loan modification, or other options to help my current situation?
- Is it possible to ignore late fees on my mortgage account?
- Get it all documented: You have to put everything down in writing once you’re able to secure a forbearance or any other mortgage relief option. You can ask your loan provider to provide documentation showing every detail confirming your forbearance agreement and that you have been cleared on the terms.
Watch out for scams!
Are you aware that there are scammers out there posing as foreclosure aid programs? Some of these scams are hard to decipher the difference with what is genuine. Falling for one of these scams can get you indebted and lose your home.
Homeowners may these problems during this period of crisis, fraud stars are out there in their numbers waiting to grab every possibility that comes their way. They’re known to contact homeowners offering financial relief including options to prevent foreclosure or eviction in an attempt to gain access to personal information, money, or other valuables.
The process sometimes involves a technique called “spoofing” where your phone caller ID will display a made-up contact that appears to be genuine, to convince you the call is legitimate. If you answer, the caller will present a false identity being a representative of an organization familiar to you.