The Coronavirus disease (COVID-19) has swept through the entire world, disrupting all facets of the daily lives of people everywhere. The strict social distancing measures have dealt a huge blow to the economy, causing numerous businesses to close and leaving employees without a salary to live with.
This increasingly problematic situation has dealt a major blow to people’s finances, leaving people with mortgages a huge problem: “how do I pay for my mortgage now?” Despite this seemingly hopeless situation, however, there is a simple solution to stave away the fear of not being able to make ends meet for this period.
Mortgage forbearance is the primary solution to combat issues with paying your mortgage during this COVID-19 season. Understandably, a majority of Americans are facing the economic standstill brought by the pandemic, which is why many lenders are accepting forbearance agreements to help out in this terrifying time.
Forbearance is the method of making an agreement with your mortgage provider to give you an opportunity to lessen the financial load of mortgages for a specified time period. Through this, you are able to defer payments—either by lessening or skipping payment—avoid late fees, and avoid foreclosure.
Take note, however, that this is merely a temporary measure and should only be used for dire scenarios. Undergoing forbearance does not erase your debt, and you will still be liable to pay the expected and missed dues at the end of the agreed-upon forbearance period.
The CARES Act
In order to further help American citizens in this dire hour of need, the government has enacted the Coronavirus Aid, Relief, and Economic Security (CARES) Act late last March. This act aims to support the country in this time of economic downfall, allowing some strain to be lifted from the finances of citizens affected by the pandemic.
One of the stipulations of this act is the push for mortgage servicers to allow a mortgage forbearance of 180 days for citizens affected by COVID-19. Should this not be enough, an additional 180 days may be re-negotiated after the initial period is passed through. On top of that, the CARES Act has placed a moratorium on foreclosures for the duration of COVID-19, thereby letting citizens rest easily about their current residential situation for the time being. This, however, is only true for loans backed by the federal government, however, many providers are allowing some leeway to be presented for other loans as well.
Mortgage Relief in California
To further the aid that the CARES Act provides, Governor Newsom of California has suspended all evictions and foreclosures in the state for an additional 90 days after the state of emergency has passed. This additional measure is to help those who could not pick up their finances despite the CARES Act or those who may not have been able to negotiate a forbearance within this period.
Have Questions About Mortgage Forbearance?
During this period of terror brought by the pandemic, your family’s finances and mortgage shouldn’t be an additional problem weighing on your mind. If you’re having trouble with handling your mortgage, then contact your lender immediately for the possibility of a mortgage forbearance.
Want to learn more about mortgage forbearance? Our mortgage broker in Los Angeles can help you in this time of need. Get in touch with us at (818) 601-2231 and claim your free mortgage rate quote today!