Assistance For Homeowners During COVID-19 Depends On Mortgage Type
Millions of renters across the country are facing evictions during the coronavirus pandemic, and homeowners are also trying to keep their homes.
COVID-19 has made it difficult for people who lost their jobs to pay rent or mortgages. Assistance available for homeowners depends on what type of mortgage they have.
Federally backed mortgages come from government agencies or enterprises like Fannie Mae or Sallie Mae.
The CARES Act offers protections for homeowners with this type of mortgage. Residences can not be foreclosed on until Dec. 31. Those with federally backed mortgages can also apply for an additional six months of forbearance.
Those with non-federally backed mortgages do not have uniform options and must go through their banks for more information.
Peter Gwaltney is the president of the North Carolina Bankers Association and says banks have flexibility.
“They have a great deal of flexibility in what they can do to help a customer in a situation like the pandemic,” he said. “Whether it's a loan modification or a payment deferral or to go interest-only for a period of time. It's just whatever is appropriate for the customer.”
But September is only one month homeowners must prepare for. Those who can pay their mortgage right now may run into issues later, says Pam Atwood, the director of housing policy for the North Carolina Housing Coalition.
“I think a lot of folks are putting their housing first,” Atwood said. “Whatever money they have, they're, they're putting it all towards paying that rent or paying that mortgage payment, but they might be maxing out credit cards, or they might be pulling from their retirement accounts. Just because folks are able to pay right now, that doesn't necessarily mean there are other problems that we'll see later.”
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