There’s a lot of talk about foreclosure in the housing market, but thankfully, this is a situation many people can avoid. If you went into forbearance because of COVID-19, you’re eligible for multiple repayment options. The good news is help is available to keep you in your home!
Relief for homeowners came from from the CARES Act
The COVID-19 pandemic struck in early 2020 and rumors of the 2008 housing crisis repeating itself soon infused nearly every real estate conversation. Understandably, homeowners have been nervous about repeating history, with fears of eviction and potential homelessness genuinely gripping many Americans. However, contrary to the Great Recession, homeowners have been better protected against the uncertainties of the Covid-19 pandemic.
That’s because the CARES Act, passed by Congress in March of 2020, provided support to many sectors of the economy, including homeowners. One way the CARES Act supported homeowners was through mortgage forbearance, allowing homeowners to postpone their mortgage payments for 18 months with no penalty. This is known as forbearance. The results are dramatic: new foreclosures in June 2020 were down by about 85% compared to June 2019, before the federal moratorium on foreclosures went into effect.
Restarting mortgage payments after forbearance
Many homeowners have already resumed payments on their mortgage and have ended the forbearance period. For homeowners that haven’t started repayment yet, there’s plenty of options available. Congress acted swiftly to avoid the kind of housing crisis the country experienced in 2008 and there’s more options available to homeowners than ever before.
While your lender will most likely suggest a lump sum repayment—meaning you owe the total amount that was in forbearance all at once—this is only one way to enter repayment. Here’s a list of 5 simple repayment options that will have you caught up on your mortgage loan in no time!
Want More Information About Avoiding Foreclosure?
Contact Linda Craft & Team, REALTORS today to find out which option fits your situation best and what the next steps are to getting started.