COVID-19 & YOUR MORTGAGE
The COVID-19 pandemic has caused widespread financial problems for many individuals and families.
The federal government has taken the lead in providing relief to those who are struggling to pay their mortgage due to the economic consequences of the pandemic.
The primary relief to struggling mortgage borrowers is forbearance.
Forbearance means a borrower can stop making payments for a specific amount of time and still be safe from foreclosure. However, forbearance does not mean the monthly payments missed are forgiven.
Depending on who the investor is for a loan, the mortgage company may or may not have to offer a good workout solution the end of a forbearance plan - meaning the payments missed may be due all at once at the end of the forbearance period.
Many borrowers will come out of forbearance in the summer and fall of 2021.
Since the beginning of the COVID-19 emergency, investors and servicers have implemented several post-forbearance repayment options and other loss mitigation options to assist borrowers experiencing a COVID-19-related hardship.
For example, servicers have offered borrowers repayment plans, payment deferral programs or partial claims programs, and loan modification programs. If post-forbearance options are unavailable or the borrower fails to qualify, the mortgage company will likely move forward with foreclosure as soon as legally possible.
If you have come out of forbearance and your lender or servicer has not offered you a solution you are eligible for or has not followed the right procedures — you probably have claims to file a lawsuit that can save your home.
Hiring an attorney experienced in foreclosure defense may be the only way to vindicate your rights.
The so-called “foreclosure moratorium” offered protection from foreclosure, but it expired on July 31, 2021.
The moratorium was mandatory for all Fannie Mae, Freddie Mac, FHA, and VA-backed loans, but many investors voluntarily stopped foreclosures for other types of loans as well. The combination of forbearance periods expiring and the end of the foreclosure moratorium means hiring an attorney experienced in foreclosure defense may be the only way to save your home from foreclosure.
The best way to find out what options are available is to contact your mortgage servicer. The mortgage servicer is the company that sends monthly mortgage statements. Stay in regular communication with the mortgage servicer and plan ahead based on what your mortgage servicer tells you is available for your type of loan. If a mortgage servicer has made promises but they do not follow through, hiring an attorney experienced in foreclosure defense may be your best option.