THE HONEST BROKER: COVID-19 & IT’S EFFECT ON THE REAL ESTATE MARKET
Like most of the country’s businesses, real estate has been impacted greatly. Unfortunately with the loss of jobs and income, home buying has been put on a temporary hold for those that were in the process of qualifying/receiving mortgages. Also, with the uncertainty with the economic situation, buyers are holding off looking for homes. However, the need for homes and mortgages will rebound back to pre-“virus” levels once this is over and the economy gets re-stimulated.
For those homeowners that are experiencing loss of jobs and incomes and have real concerns about mortgage payments and their obligations to their lenders there are some new federal guidelines that have come as a result of this crisis.
Fannie Mae and Freddie Mac
- Homeowners who are adversely impacted by this national emergency may request mortgage assistance by contacting their mortgage servicer
- Foreclosure sales and evictions of borrowers are suspended for 60 days
- Homeowners impacted by this national emergency are eligible for a forbearance plan to reduce or suspend their mortgage payments for up to 12 months
- Credit bureau reporting of past due payments of borrowers in a forbearance plan as a result of hardships attributable to this national emergency is suspended
- Homeowners in a forbearance plan will not incur late fees
- After forbearance, a servicer must work with the borrower on a permanent plan to help maintain or reduce monthly payment amounts as necessary, including a loan modification
Federal Housing Administration (FHA):
The U.S. Department of Housing and Urban Development (HUD) has authorized the FHA to implement an immediate foreclosure and eviction moratorium for single family homeowners with FHA-insured mortgages for the next 60 days.
Bank Regulators have also instructed banks and servicers to be proactive in extending help to homeowners. Therefore, banks have posted their own policies and ways for consumers to contact them for assistance: Bank of America, Capital One, Chase, Wells Fargo, among others, is cooperating with their clients.
I encourage you to call your lender to verify the policy regarding your mortgage. If you are in a rental situation, there are protections for you under new federal guidelines as well.
Stay well and stay healthy.
Diane Lott, Broker
Paradise Found Realty, Inc. of Palm City
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