Fannie Mae: ”
After a forbearance plan is completed the mortgage loan must be brought current if the borrower intends to retain the property. The servicer must begin attempts to contact the borrower no later than 30 days prior to the expiration of the forbearance plan term and must continue outreach attempts until either QRPC is achieved or the forbearance plan term has expired. Per Lender Letter LL-2021-02, Impact of COVID-19 on Servicing, for COVID-19 impacted borrowers, we are eliminating the requirement that the servicer determine the occupancy status of the property. A loan may be brought current through: • reinstatement, which is the repayment of past due amounts in a single payment; or • approval of the borrower for another workout option, such as a: o repayment plan, which may be appropriate if the hardship has been resolved but the borrower does not have the ability to reinstate the mortgage loan, but can afford a monthly repayment plan payment in addition to their monthly mortgage payment1 ; o COVID-19 payment deferral, a workout option specifically designed to help borrowers impacted by a hardship related to COVID-19 and whose financial hardship is resolved return their mortgage to a current status after up to 18 months of missed payments (refer to LL 2021-07); or o The Fannie Mae Flex Modification mortgage loan modification option, as described in LL 2021-07 and in Fannie Mae’s Servicing Guide, D2-3.2-07, Fannie Mae Flex Modification. The borrower may also pay off the mortgage loan in full.
If the borrower is unable to or does not intend to retain the property with a retention workout option after forbearance, options available include a short sale, or a Mortgage Release™ (Deed-in-Lieu of Foreclosure); or the servicer refers the mortgage loan to foreclosure in accordance with applicable law.”
Fannie Mae: “As described in Servicing Guide, D2-2-01, Achieving Quality Right Party Contact with a Borrower, QRPC is a uniform standard for communicating with the borrower, co-borrower, or a trusted advisor, about resolution of the mortgage loan delinquency. We reaffirm the applicability of QRPC when working with a borrower impacted by
COVID-19 to ensure the servicer understands the borrower’s circumstances and determines the best possible workout option for resolving the borrower’s delinquency. In the event that the servicer is unable to achieve full QRPC and offers a forbearance plan to a borrower impacted by COVID-19 in compliance with applicable law, the servicer is considered to be in compliance with our Servicing Guide. Note that all contact attempts must be documented in the mortgage loan servicer file, and that the servicer is
authorized to use various outreach methods to contact the borrower as permitted by applicable law, including but not limited to:
- texting, and
- voice response unit technology
Since the above list is not exhaustive, methods may also include use of technology platforms and websites if those are permitted by applicable law. See Servicing Guide A4-2.1-04, Establishing Contact with the Borrower, for the servicer’s responsibilities in its attempts to contact a borrower.”
Fannie Mae: “The servicer must follow the requirements in Servicing Guide D2-3.2-01, Forbearance Plan, when evaluating the borrower for and offering a forbearance plan. At the request of the borrower, the servicer is authorized to provide an initial forbearance plan term of up to 6 months, and grant an extension of the initial forbearance term of up to an additional 6 months at the request of the borrower. The servicer is authorized to offer the 6-month terms in separate, shorter increments. In accordance with LL-2021-02, Impact of COVID-19 on Servicing, for a borrower with a financial hardship relating to COVID-19, the servicer is authorized to permit a cumulative forbearance plan term of up to 12 months as measured from the start date of the initial forbearance plan, regardless of the delinquency status of the mortgage loan. For a borrower actively performing on a COVID-19 related forbearance plan as of February 28, 2021, the servicer is authorized to grant an extension of the forbearance plan term of up to 3 months, and grant one or more forbearance plan term extensions of up to 3 months, if upon reaching a cumulative forbearance plan term of 12 months as measured from the start date of the initial forbearance plan, the servicer determines that the borrower’s hardship has not been resolved. The servicer’s determination to extend the forbearance plan beyond 12 months must be as a result of achieving QRPC. As noted above, in the event that the servicer is unable to achieve full QRPC and offers a forbearance plan to a borrower impacted by COVID-19 in compliance with applicable law, the servicer is considered to be in compliance with our Servicing Guide, D2-2-01, Achieving Quality Right Party Contact with a Borrower. For mortgage loans actively performing on a COVID-19 forbearance plan as of February 28, 2021, the servicer must receive Fannie Mae’s prior written approval for a forbearance plan to exceed a cumulative term of 18 months as measured from the start date of the initial forbearance plan, or result in the mortgage loan becoming greater than 18 months delinquent.”
Fannie Mae: “Examples of permanent hardships may include permanent loss of income due to death, disability, divorce, illness, permanent increase in expenses such as on-going medical costs, or permanent depletion of cash reserves due to uninsured losses.”
Fannie Mae: “Examples of temporary hardships may include temporary loss of income due to unemployment, reduction in working hours, illness, or an increase in expenses such as a large medical bill, which has impacted the borrower’s ability to make their monthly mortgage loan payment.”
Fannie Mae: “In accordance with Lender Letter LL-2021-02, Impact of COVID-19 on Servicing, servicers are authorized to provide a forbearance plan to any borrower who requests a forbearance as a result of a financial hardship caused by the COVID-19 emergency. A complete borrower response package is not required. In addition, Fannie Mae’s workout option hierarchy provides several options for resolving the delinquency after the forbearance plan ends. For example, if the borrower is unable to reinstate the loan or afford a repayment plan to bring the loan current, Lender Letter LL-2021-07, COVID-19 Payment Deferral, provides guidelines for servicers to evaluate a borrower for a COVID-19 payment deferral or loan modification.”
Fannie Mae: “As the world’s largest manager of mortgage credit risk, Fannie Mae has comprehensive loss mitigation policies and procedures in place to address temporary and permanent hardships. These transparent industry standards for borrower assistance help Fannie Mae ensure efficiency and consistency in loss mitigation. Fannie Mae also
makes proprietary tools such as Servicing Management Default Underwriter™ (SMDU™) available to servicers to simplify and automate loss mitigation decisioning.
One of the most effective tools available to provide rapid relief to borrowers is temporary payment forbearance (a period in which borrowers may make no payments or partial payments). Our forbearance plan is designed in alignment with Freddie Mac and at the direction of the Federal Housing Finance Agency (FHFA). A forbearance plan (also known as payment forbearance) is appropriate if the temporary hardship has not been
resolved but may reasonably be expected to be resolved within a short period of time. It is not the same as principal forbearance (i.e., deferral of a portion of the unpaid principal balance (UPB) until the loan’s maturity date or early payoff of the mortgage loan), which can be utilized in certain circumstances, such as in connection with a loan modification in cases of permanent hardship.”
National Association of REALTORS®: “No. If your mortgage is backed by Fannie Mae or Freddie Mac and you take forbearance you can refinance or get a new mortgage immediately, if you are current on your payments. If you took forbearance and stopped making payments, but are on a repayment plan and make 3 consecutive payments on that plan, you are eligible for credit to refinance or purchase another home.
FHA has not clarified its position on this issue, but has indicated that it will come to a decision in the near future. Private lenders may or may not allow a homeowner who took forbearance to get mortgage credit in the future. You should check with your lender.
While Fannie Mae and Freddie Mac do allow for owners who took forbearance to get credit, a lender can place their own restrictions and choose not to refinance the loan or provide a mortgage. In such a case, the consumer can work with a different lender.”
National Association of REALTORS®: “No. The CFPB’s guidance indicates that forbearance should only be used by homeowners who are genuinely in distress and cannot afford to make payments. The program is not intended as a stimulus or incentive to buy a home. Missed payments are not forgiven, but delayed and will need to be made up.
Furthermore, widespread forbearance is causing lenders to raise requirements on new home buyers. If new homebuyers use forbearance unnecessarily, this will cause lenders to pull back further, making it even more difficult to buy and sell homes.”
National Association of REALTORS®: “FHA and RHS are allowing verbal verification of employment. Specifically, your employer can provide this by phone. RHS is also allowing email verification. If you cannot get either of these, the lender will require higher reserves to cover risk.
Fannie Mae and Freddie Mac will allow verbal verification when available and an email verification under certain conditions. They have also made other forms of temporary verification available in order to help with verification while social distancing.”
CFPB:
- “What options are available to help temporarily reduce or suspend my payments?
- Are there forbearance, loan modification, or other options applicable to my situation?
- When will you waive the late fees on my mortgage account?
- What should I do at the end of my forbearance period? When should I contact or expect to hear from my servicer prior to the end of the forbearance period?
- What are my payment options at the end of the forbearance period?
- If your loan is not federally backed or is not backed by Fannie Mae or Freddie Mac, ask: What restrictions and requirements will apply at the end of the forbearance period?
- Will interest be charged on my unpaid mortgage payments during forbearance?
- What are my rights if I disagree with your determination?”
Housingwire: “Your servicer should contact you prior to the end of your forbearance plan to discuss options for bringing the mortgage current. However, you can contact them to begin this discussion and determine the best option for you, based on your individual circumstances.”
Housingwire: “Yes, if you have experienced job loss, reduced income, illness or other issues related to COVID-19 you could be eligible for forbearance.”
Housingwire: “You may be eligible for another loan modification, pending no eligibility restrictions. Your servicer will confirm your eligibility.”
Housingwire: “Home retention options may include payment deferral or a loan modification. For COVID-19 related hardships, there are additional flexibilities for these options. If homeownership is no longer affordable, there are options to exit the home without facing the costly impacts of foreclosure, including a short sale or deed-in-lieu.”
Housingwire: “Yes.”
Housingwire: “An option for homeowners who can no longer afford their pre-forbearance payment. For example, a Freddie Mac Flex Modification, targets a 20% payment reduction by extending the mortgage term to 40 years, reducing the interest rate (if applicable) and creating a forborne balance (if applicable).”
Housingwire: “If you have the financial capacity, the most desirable option is to do a reinstatement or repayment plan. Reinstatement is the act of restoring a delinquent mortgage to current status. A repayment plan is when the homeowner pays the regular monthly payments plus an additional agreed upon amount in repayment of the delinquency for a period of time. However, there are additional options, including deferring missed payments until the end of the loan (payment deferral), payment relief options if needed (loan modification) or other alternatives.”
Fannie Mae: “The update to record retention requirements applies to all loans delivered with remote online notarizations in accordance with the requirements set forth in LL-2020-03. For loans delivered prior to Aug. 27, 2020, lenders will not be required to store the notarial ceremony for the life of the loan and instead must maintain the notarial ceremony per the updated requirements of LL-2020-03.”
Freddie Mac: “The update to record retention requirements applies to all mortgages delivered with remote online notarizations in accordance with the requirements in Bulletin 2020-8. For mortgages delivered prior to August 27, 2020, Sellers will not be required to store the notarial ceremony for the life of loan and instead must maintain the notarial ceremony in compliance with the updated requirements of Bulletin 2020-35.”
Washington Post: “How much your score will drop depends on a lot of factors. Generally, the impact will be more noticeable on a credit report with no history of missed payments vs. a credit report that already shows a history of missed payments, said Tom Quinn, vice president of scores at FICO.
In an example provided by FICO, a homeowner who has never missed a payment has a FICO score of 793. But a 30-day late payment could drop her score by as much as 83 points. But the drop to the low 700s on a scale that runs from a low of 300 to a high of 850 is still a good score.”
ICBA: “For GSE loans, interest continues to accrue and then the bank adds those deferred payments onto the end of the loan, maintaining the same amortization. Any taxes or insurance the bank must advance that was not collected during the forbearance period can be capitalized into the balance.”
Housingwire: “Yes, borrowers impacted by COVID-19 are eligible for forbearance regardless of whether their property is owner-occupied, a second home or an investment property.”
“Before the end of your forbearance period, your servicer should reach out to you to negotiate end of forbearance terms for repayment and possible extensions in certain situations, or a relief or workout option following forbearance.”
Fannie Mae: “You may be eligible for a refinance or a new mortgage loan if you are in forbearance but have continued to make timely payments. You may also be eligible for a refinance or a new mortgage loan if you were previously in forbearance but have resolved any missed payments through a reinstatement or have made three timely payments either in accordance with a repayment plan or following a payment deferral, or completed the trial period plan payments in connection with a modification. Contact your mortgage lender to discuss your options as other eligibility requirements may apply.”
Fannie Mae: “If your mortgage is covered by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), you do not have to provide extensive documentation to show your financial circumstances have been impacted by COVID-19. Before reaching out to your mortgage servicer, check the company’s website to see what information they provide about forbearance plans and if you can apply online. Before you speak with a representative, have your account number available and be prepared to ask questions about your mortgage payment assistance options, including your ability to obtain a forbearance plan.”
Fannie Mae: “The forbearance plan process involves four simple steps. However, millions of people are seeking financial assistance for their mortgages right now, so contact centers at mortgage servicing companies may have longer than usual wait times. In some cases, you may be able to request assistance online.”
Fannie Mae: “If you are experiencing a financial hardship related to COVID-19, don’t wait. Contact your mortgage servicer (the company that receives your mortgage payments) today to learn about the temporary mortgage assistance options available to you. You can discuss options that allow you to either pause or lower your payments, so you have time to regain your financial footing. Start seeking assistance options while you are still making your mortgage payments, so you can avoid negative impacts like delinquent credit reporting or late fees.”
National Association of REALTORS®: “FEMA is extending the grace period to renew flood insurance policies from 30 to 120 days. If a policy has an expiration date between February 13, 2020 and June 15, 2020, then the NFIP insurer must receive the appropriate renewal premium within 120 days of the expiration date to avoid a lapse in coverage. Likewise, if a policyholder receives an underpayment notice dated between February 13, 2020, and June 15, 2020, then the NFIP insurer must receive the additional premium amount requested within 120 days of the date of the notice.”
AARP: “Yes, on a case-by-case basis. Bank of America, for one, says that mortgage borrowers can request to defer payments, with payments added to the end of the loan. Wells Fargo is suspending residential property foreclosure sales and evictions. Wells Fargo is telling its mortgage customers, “If you’re unable to make your payment due to COVID-19 related hardships, we’re offering a 90-day payment suspension.” And Chase bank asks worried mortgage holders to call to work out a plan. If you need help, be proactive and give your bank a call.”
AARP: “The average 30-year fixed mortgage rate was 3.50 percent the week ended March 19, according to Freddie Mac. The rule of thumb is that you should consider refinancing only if the new mortgage rate would be 1 percentage point lower than your current rate.
But there are plenty of variables, such as fees and points. (A point is an upfront fee equal to 1 percent of the loan; the more points you agree to pay, the lower your rate.) Will you stay in your home long enough for the lower rate to offset the cost of fees and points? You can crunch the numbers using mortgage calculators such as those offered by Bankrate, NerdWallet, HSH, SmartAsset and others.
Refinancing demand is high, and it may take longer than usual to get appraisals and title searches as government offices shut down because of the coronavirus epidemic. You may also have to do a virtual closing via videoconference, to maintain social distancing safety guidelines. Ask your bank how long their refinancing process takes, and whether they are reasonably sure that they can close the deal in a reasonable amount of time.”
CFPB: “After your forbearance period ends, you will have to make arrangements with your servicer to repay any amount suspended or paused.
Under the CARES Act, if you have a federally backed mortgage, you also can request an extension of the forbearance for up to an additional 180 days.
The method of repayment varies depending on your loan and the options offered. Not all borrowers will be eligible for all options. You should take steps to be aware of how these programs work and what you can expect in terms of repaying these amounts.
Generally, repayment of forbearance occurs by the amount being repaid:
- In one lump sum at the end of the forbearance period;
- Added onto your existing monthly payments over a set number of months;
- Added to the end of your loan as additional payments or as a lump sum.
Just as forbearance may differ between the federally backed agencies or entities, so does the repayment of the forbearances.
Please check back for updated information as well as check with your loan servicer and the website of the agency or entity that owns or guarantees your loan. The following information provides some of the options to repay your forbearance.
Fannie Mae & Freddie Mac loans:
- Borrowers allowed to repay past due amount within 12 months after forbearance ends;
- Extend the term of the mortgage by the exact number of months in forbearance;
- Add past due amounts into loan balance and extend the term of the loan by the number of months necessary to make the monthly payment the same as the previous payment;
- Add past due amounts into loan balance and extend term of loan for 40 years (480 months).
FHA loans:
- Borrowers may enter into a repayment plan to repay past due amounts within 6 months after forbearance ends;
- Extend term of mortgage to 30 years (360 months) by adding the past due amounts into the previous monthly payment;
- Past due amounts paid off at the end of the loan in a lump sum.
VA loans:
- Borrowers may enter into a repayment plan to repay past due amount within 6 months after forbearance ends;
- Add past due amount into loan balance and extend term to 30 years (360 months);
- Targets lower payment of 31% of borrower’s gross income by extending loan term to 30 years (360 months) with option to forbear principal.
USDA loans:
- Borrowers may enter into a repayment plan to repay past due amounts within 6 months;
- Add past due amount into loan balance and extend term to 30 years (360 months) as long as payment less than or equal to payment prior to forbearance;
- Lump sum repayment at loan payoff.
CFPB: “If you need help working with your servicer or understanding your options you may want to reach out to a professional to help you with your specific situation.
- HUD-Approved Housing Counselors: The U.S. Department of Housing and Urban Development (HUD)-approved housing counselors can discuss options with you if you’re having trouble paying your mortgage loan or reverse mortgage loan. This may also include forbearance or a modified payment program.
- Credit Counselors: Reputable credit counseling organizations are generally non-profit organizations that can advise you on your money and debts, and help you with a budget. Some may also help you negotiate with creditors. There are specific questions to ask to help you find a credit counseling organization to work with.
- Lawyers: If you need a lawyer, there may be resources to assist you through your local bar association, legal aid, or if you are a servicemember, your local Legal Assistance Office.
- State-specific support: Your state may also offer additional mortgage relief options. Many states are implementing or considering various mortgage relief options that are in addition to federal initiatives, including the suspension of foreclosures, as well as additional assistance for homeowners. Check your state’s government website for details.”
OCC: “You should contact your loan servicer as soon as possible to let them know of your circumstances. The OCC has encouraged banks to work with customers who have been adversely affected by COVID-19.
If your loan is owned by Fannie Mae and Freddie Mac (the Enterprises) and your ability to pay your mortgage is affected, you may be eligible to delay making your monthly mortgage payments temporarily. Additionally, on March 18, 2020, the Federal Housing Finance Agency (FHFA) directed the Enterprises to suspend foreclosures and evictions for at least 60 days due to the COVID-19 national emergency. More information is available on the FHFA website.
The OCC generally does not have the authority to stop a foreclosure, but you can file a “Customer Complaint Form” with the OCC if you are having problems with your bank’s handling of your mortgage loan. The OCC can facilitate communications between you and the bank once your written complaint is received.
We advise you to contact the U.S. Department of Housing and Urban Development to review information and understand your options. This service is free and available 24/7. You can visit the OCC’s Help With My Bank website and review the general information under the Mortgages category for more details. You may also want to seek legal assistance to protect your rights.”
TransUnion: “After talking to your lenders about your situation, you may learn that they will place your accounts in forbearance/hardship or deferral. These are common methods lenders use to report accounts to the credit reporting agencies.
Having an account in forbearance usually means your lender has agreed that you can temporarily stop making payments on that account for a certain amount of time.
A deferred account means the lender has agreed that you can delay payment for a certain amount of time. Usually, this will show up on your credit report in the Remarks field with a comment that says “Payment Deferred.”
If you’re curious how your credit score will be impacted by an account in forbearance/deferral, check out the VantageScore or FICO websites for more information. It’s important to note, a credit score is based on many factors in your credit report and different scoring models use different methods to calculate credit scores.”
Equifax: “While forbearance may allow you to deal with your short-term financial challenges and help you get back on your feet without jeopardizing your credit rating or credit scores, it doesn’t come without its drawbacks. If you enter into a forbearance agreement, you’re not getting “free money.” Depending on the repayment plan you agree to with your lender or creditor, you may need to repay the interest that accrues during your approved deferral period, and late fees may still apply. Ask your lender if you’ll still be charged late fees, how and when those fees will be applied and how your forbearance agreement will be reported to the national credit bureaus.”
Experian: “Without a forbearance or deferral agreement, skipping or making partial loan payments is considered delinquency. Delinquencies are recorded on your credit report and can have a major negative impact on your credit score.
How suspended or reduced payments are handled under forbearance agreements differs by loan type. Their consequences for mortgages and student loans have different potential impacts on your credit.
With the exception of special circumstances during emergencies such as the COVID-19 crisis (more on that below), mortgage payments missed or underpaid as part of a deferral or forbearance arrangement are technically delinquencies, since they don’t conform to the repayment terms spelled out in your original loan agreement. Mortgage lenders have the right to report them as such to the credit bureaus, but they’re not required to do so. Ask your lender about their policy before accepting a forbearance agreement so you know what to expect.
Under mortgage forbearance agreements, lenders agree to refrain from pursuing foreclosure proceedings, which can do lasting damage to your credit over and above the harm caused by missed payments. A foreclosure stays on your credit report for seven years from the date of the first delinquency that led to foreclosure, so if forbearance allows you to avoid foreclosure, taking a near-term credit score hit might be a worthwhile trade-off.”
House Finance Services Committee: “If you are approved for a forbearance, a payment delay, or other payment arrangement with your creditor or servicer, and you are current on your accounts, then the creditor or servicer will continue to report you to the credit rating agencies (or CRAs) as current or up-to-date. In this case, your credit report and score would not be negatively impacted by these non- or delayed payments during the covered period of the arrangement. Unfortunately, if you were already reported to be behind on payments prior to the payment arrangement, the creditor or servicer can continue to report you as late to the CRAs, meaning continued non-payments may be treated negatively on your credit report and score.”
National Association of REALTORS®: “The CARES Act implemented provisions to protect credit scores from January 30, 2020 through 120 days after enactment of the national emergency. If customers are making payments, or made arrangement to not make payments, customers must be reported as being current. If a customer was delinquent, but was able to make an arrangement with the servicer and is now current, then their account must be reported as current. The important thing is to reach out to your servicer, bank or credit card company if you are having trouble making your payments.”
Fannie Mae: “No, a borrower may make payments during the forbearance plan without any impact to the length of the forbearance plan. If a borrower requests a shorter forbearance plan, the servicer must shorten the forbearance plan and, at the completion of the forbearance plan, evaluate the borrower for post-forbearance options.”
Freddie Mac: “No, a borrower may make payments during the forbearance period. The forbearance plan will continue to term and the payment must be applied as usual in accordance with Guide Section 8103.4.”
The first thing is call your servicer. Communication is critical and there are a lot of options available if you need help. Second, document every conversation and follow up in a letter or email noting what was discussed in your phone call. This will help you and the next person you talk to when you call back or they call you. And finally, don’t freak out if they tell you paying back all of the money at one time is an option. It is an option but it is not a requirement. Obviously, if you can’t pay one mortgage payment this month, you’re not going to be able to pay six of them six months from now. The gold standard of forbearance is mortgage deferral, where your missed payments are applied to the end of your loan. That means you don’t pay it back until you sell your house or at the end of your mortgage term. The tricky part is that they can’t offer it to you until you are able to pay your mortgage again, so stay in touch while you are out of work, and be assertive about deferral when you are ready to resume your mortgage payments.
HUD: “Yes. Even if you received an FHA COVID-19 Forbearance, you are not required to use the full six months. It is more beneficial for you to begin making your regular mortgage payments as soon as you can reasonably do so. If you are able to begin making your payments prior to the expiration of your forbearance, contact your mortgage servicer and let them know you are ready to resume making your regular monthly mortgage payment. Your servicer will assist you in doing so.
Federal and state governments have announced plans to help struggling homeowners during this time. For more information, visit: https://www.consumerfinance.gov/about-us/blog/guide-coronavirus-mortgage-relief-options/
Additional information is available in the following video: VIDEO: CARES Act Mortgage Forbearance: What You Need to Know
Benefits.gov is an online resource to help you find federal benefits you may be eligible for in the United States. Visit https://www.benefits.gov/ for more information and a link to the Benefit Finder, to find information on government benefits you may be eligible to receive.”
HUD: “FHA servicers will ask you to confirm that you are having a financial hardship, either directly or indirectly, due to the COVID-19 National Emergency in order to qualify for a COVID-19 Forbearance, but will not require that you supply any documents.
Your mortgage servicer can further explain the COVID-19 Forbearance and help you figure out other options for repaying the suspended mortgage payments or the balance of reduced mortgage payments.
Federal and state governments have announced plans to help struggling homeowners during this time. For more information, visit: https://www.consumerfinance.gov/about-us/blog/guide-coronavirus-mortgage-relief-options/
Additional information is available in the following video: VIDEO: CARES Act Mortgage Forbearance: What You Need to Know
Benefits.gov is an online resource to help you find federal benefits you may be eligible for in the United States. Visit https://www.benefits.gov/ for more information and a link to the Benefit Finder, to find information on government benefits you may be eligible to receive.”
CFPB: “To help keep Americans connected during the coronavirus pandemic, the Federal Communications Commission (FCC) has temporarily waived Lifeline usage requirements and general de-enrollment procedures until May 29, 2020. An FCC order , released on March 30, 2020, will help ensure that no current Lifeline subscribers are involuntarily removed from the Lifeline program during this time of national crisis.”
CFPB: “Many states have suspended public utility disconnections. Check with your state utility commission or your local utility to see what protections or relief may be available. Municipal utilities and Rural Electric Cooperatives (REC) may be covered by your state’s emergency proclamation. They may also have their own COVID-19 disconnection policy. Check with your municipal utility or REC for details.”
CFPB: “While you’re in the forbearance period, or working under another mortgage relief option, there are a number of things to do to continue to protect yourself. This advice applies to both a CARES Act forbearance and other mortgage relief that you might receive.
- Keep written documentation on hand. You want to make sure that you have this documentation available in case there are any errors on your monthly mortgage statements to ensure that your statement reflects the assistance provided.
- Pay attention to your monthly mortgage statement. Continue monitoring your monthly mortgage statements to make sure you don’t see any errors. Stop or change auto-payments for your mortgage. If you are having your mortgage payment deducted automatically from your bank account, make sure you make any necessary adjustment to avoid any fees or charges.
- Keep an eye on your credit. It’s a good idea to routinely check your credit reports in order to make sure there are no errors or inaccuracies. If you stop making mortgage payments without a forbearance agreement, the servicer will report this information to the credit reporting companies, and it can have a lasting negative impact on your credit history. If an error has been made, however, you can work to dispute it.
- Get more information about protecting your credit during the coronavirus pandemic.
- Once your income is restored, contact your servicer and resume your payments. With forbearance, you still owe the payments that you missed, but fewer missed payments mean you’ll owe less down the road.
- If you’re continuing to receive some income that turns out to be more than you need for your bills and expenses (including anything you keep paying on your mortgage), consider putting the extra money away so you can use it to pay off what’s needed later. If you can save any money now, it’ll be helpful when payments are due later.
- Your property taxes and insurance should continue to be paid if your mortgage has an escrow account, but you may want to confirm with your servicer. If your mortgage does not have an escrow account, you will be responsible for these payments.”
Department of Veterans Affairs: “If you’re having difficulty making your mortgage payment, contact your loan servicer right away. This is your chance to find a solution that might work for your scenario.
If you’re nervous about contacting your servicer, or if you’d like our help and advice, please contact a VA loan technician at 877-827-3702.
Be careful about offers to help you make up back payments
If you’re behind on your mortgage payments and you get this type of offer from someone you don’t know, contact the servicer of your mortgage or your nearest VA regional loan center for advice. They can let you know if it’s an honest offer.”
Department of Veterans Affairs: “There are 6 general ways you can try to avoid a foreclosure:
- Repayment plan: If you’ve missed a few mortgage payments, this plan lets you go back to making your regular payments, with an added amount each month to cover the ones you’ve missed.
- Special forbearance: This plan gives you some extra time to repay the missed mortgage payments.
- Loan modification: Sometimes you need a fresh start. This plan lets you add the missed mortgage payments and any related legal costs to your total loan balance. You and your servicer then come up with a new mortgage payment schedule.
- Extra time to arrange a private sale: If you need to sell your home, this plan lets you delay a foreclosure so you have time to sell.
- Short sale: If you owe more money than your house is worth, your servicer might agree to a short sale. This means the servicer will accept the total proceeds from the home sale (even if it’s less than the full amount you owe on the mortgage) as full payment of the debt you owe.
- Deed in lieu of foreclosure: This plan lets you avoid the foreclosure process by signing over the deed to the home to your servicer. The home will then belong to the servicer.
Our VA loan technicians can help you figure out which option is best for you. Contact a VA loan technician at 877-827-3702.”
FHFA: “Homeowners must contact their servicer to let them know they are impacted and having difficulty making their mortgage payment. Servicers will review the homeowner’s situation to determine whether forbearance is appropriate. Homeowners do not need to provide extensive documentation to be placed in a forbearance plan.”
FHFA: “Forbearance is for homeowners in need of assistance, so only those unable to make their mortgage payment should request it. The first step homeowners should take is to determine whether they are able to make their next mortgage payment. Those homeowners still able to pay their mortgage, should continue to do so. Homeowners unable to make their next mortgage payment due to a decline in income resulting from the impact of COVID-19, should call their servicer immediately upon making that determination.”
FHFA: “At the end of the forbearance period, homeowners are still required to eventually fully repay the forbearance, but they will not have to repay it all at once unless they are able to do so. Servicers will reach out to homeowners in forbearance about 30 days before the scheduled end of forbearance to determine which assistance program works best for the homeowner at that point – a repayment plan, loan modification, or an extension of the forbearance period if needed.”
CFPB: “Forbearance doesn’t mean your payments are forgiven or erased. You are still obligated to repay any missed payments, which, in most cases, may be repaid over time or when you refinance or sell your home. Before the end of the forbearance, your servicer will contact you about how to repay the missed payments.”
FHFA: “A forbearance plan is an agreement between a homeowner and their mortgage servicer (the company they send their monthly mortgage payments to) that establishes an alternative payment schedule to reduce or suspend payments for a period of time. Importantly, mortgage forbearance plans do not reduce the principal amount owed on a mortgage, and interest continues to accrue for the duration of the plan. Homeowners who can afford to make partial payments should do so in order to lessen the amount due at the end of the forbearance.”
FHFA: “Homeowners unable to make their mortgage payments resulting from the impact of COVID-19 (regardless of whether they have contracted the virus) may be eligible for a mortgage forbearance plan to reduce or suspend their mortgage payments for up to 12 months. This assistance is available to homeowners with single family or condominium mortgages owned by Fannie Mae or Freddie Mac (the Enterprises) regardless of whether their property is owner occupied, a second home, or an investment property.”
House Financial Services Committee:
Beware on anyone seeking to charge you for accessing the relief provided under the bill. The bill provides eligible borrowers the right to request and receive forbearance on their mortgage payments for up to 6 months, with the option to extend for an additional 6 months (total max of 1 year), as well as the option to discontinue the forbearance at any time. Contact your mortgage servicer to determine whether your mortgage is eligible for forbearance under the bill. You do not need to pay any fees if you are eligible to receive these benefits. Eligible homeowners, however, do need to contact their servicer to request a forbearance.
Beware of anyone charging you in advance for assistance in modifying the terms of your mortgage. In most circumstances, it is unlawful to charge fees in advance for a mortgage modification. Contact your servicer to inquire about options for modifying the terms of your mortgage.”
