The Covid-19 pandemic has impacted the global economy adversely. It has also hurt the US economy by unprecedented levels. The effect has been felt by Americans in many aspects of their lives. Unemployment rate is shooting up faster than it did during the 2008 recession, a sign that the economy is headed toward a recession. Over 50 million people are still out of the workforce as businesses close down permanently. New unemployment claims have now exceeded 1 million for 19 consecutive weeks. In such a scenario, a number of homeowners are facing difficulty in making their mortgage payments due to job loss, income reduction or sickness. This is why we shall discuss the available options of help for homeowners in South Bay CA.
To begin with, the Federal Housing Finance Agency (FHFA) has updated its policies and guidance to ensure its regulated entities – Fannie Mae, Freddie Mac (the Enterprises), and the Federal Home Loan Banks (FHLBanks) – are fulfilling their mission of providing market liquidity during this difficult time. So if your home loan is owned by one of these lenders and your ability to pay mortgage is affected, you may be eligible to delay making your monthly mortgage payments for a temporary period, during which:
- You won’t incur late fees.
- Foreclosure and other legal proceedings will be suspended
You need to contact your mortgage servicer and inform them about your situation. If you have trouble catching up at the end of this temporary relief period, additional assistance may be available. You are not required to repay missed payments all at once. For more information, visit the FHFA website.
Help by Real Estate Agencies
In the case that you aren’t able to avail government help, or you’re still facing hardship on your home loan after help from your lender, there are other options you might want to look into. There are professional real estate agencies that specialize in helping homeowners in distressed property situation. They provide several options to suit the specific requirements of a homeowner. You could get help in one or more of the following ways:
Forebearance: It is an agreement with your mortgage company to temporarily suspend or reduce your monthly mortgage payments for a specified period of time.
Reinstatement: A reinstatement occurs when the borrower brings the delinquent loan current in one payment. It avoids a foreclosure because the borrower is allowed to catch up on payments in default, as well as fees and expenses incurred as a result of the default.
Repayment Plan: An agreement between you and your mortgage company that lets you pay the past due amount—added on to your current mortgage payments—over a specified time period to bring your mortgage current.
Home Loan Modification: An agreement between you and your mortgage company to change the original terms of your mortgage—such as payment amount, length of loan, interest rate, etc.
These are some of the popular options of help for homeowners in a distressed situation. These agencies have expertise in the field and have other options as well to help a homeowner facing financial hardship. To avail help for homeowners in South Bay CA, contact Property LA Home Services on 310-715-9613.