During the time of the Coronavirus pandemic, many families are experiencing economic hardships. These hardships are leaving families facing mounting debt and delayed mortgage payments are creating a general panic among Americans who are now jobless. The good news is that if your loan is backed by Freddie Mac or Fannie Mae, these lenders are offering relief options.
Mortgage Relief From Fannie Mae and Freddie Mac
Mortgage Relief From Fannie Mae
If your mortgage is backed by Fannie Mae and you find yourself unable to pay due to income reduction, job loss, or sickness as a result of COVID-19, you have the options of:
The Fannie Mae forbearance plan offers clients a reduction or suspension of mortgage payments for six months at a time for up to 12 months.
Late Fee Relief
Mortgage holders will also see late fees being relieved during their forbearance plan.
Repayment Options After Forbearance
Multiple forbearance repayment options are available, these include a repayment plan to allow for missed payments to be caught up gradually or permanent modification of the loan terms that allow you to maintain your current monthly payment or reduce it further.
Mortgage Relief From Freddie Mac
Mortgage holders who have loans backed by Freddie Mac and whose income has been impacted by COVID-19 are also being offered a few options:
Like Fannie Mae, Freddie Mac is giving mortgage holders the option of forbearance for up to 12 months.
Late Fee Relief
Additionally, Freddie Mac customers will also have late fees and penalties assessed during their forbearance plan waived.
Foreclosure and Evictions Paused
Freddie Mac is also putting a stop to all evictions of borrowers living in Freddie-Mac homes and all foreclosure sales until May 17, 2020, at the very soonest.
Suspending Credit Reporting
Freddie Mac will also be suspending their reports of delinquency to credit bureaus in regard to forbearance.
Like Fannie Mae, Freddie Mac will also be offering a number of options for repayment after the forbearance period is over. Clients will have the option to both lower their monthly payments or keep their payments the same once the forbearance period is over.
More Freddie Mac Information can be found at My Home by Freddie Mac®
What Should You Do?
If you have concerns about your mortgage payments, the first thing you should do is get in contact with your mortgage servicer and let them know your current situation. They will likely work with you to ensure that you can stay in your home without being overrun by debt. When you contact your mortgage company, just be sure that you have instant access to your financial documents to make the call go as smoothly as possible.
You should also keep in mind here that lenders are going to be experiencing exceptional call volume and hold times will be excessive, but it’s important to stay on the line.
The Federal CARES Act
In addition to the plans outlined above, the federal CARES Act which was signed into law on March 27th, 2020, may offer homeowners the option of foreclosure and eviction relief.