If you’re like many homeowners, COVID-19 is creating a financial hardship which may make it difficult for you to make your mortgage payments. Keep in mind that your lender wants to help you meet your commitment and may be able to offer you payment options to lessen the stress you feel during this challenging time. But every lender and loan program are treating the situation differently and guidelines are changing quickly. So, if you anticipate that COVID-19 will impact your ability to pay your mortgage, you need to contact your service provider ASAP to determine what options may be available to you.
Here are our tips for working with your lender when you’re unable to make your payments because of a financial hardship:
The first step is to contact your mortgage servicer IMMEDIATELY, before your payment is late. Remember, your loan may have been sold since you got it, so the best place to find the right phone number or email address is on your most recent mortgage statement. Be sure to keep this statement handy, as you’ll need to provide your loan number and other information relevant to your account. Contact your provider as soon as you anticipate a problem to avoid any late payment fees or charges. Plus, your lender will appreciate your willingness to make arrangements rather than fall behind – it demonstrates your goodwill and intention to honor your commitment.
Explore Your Options.
Your options may vary depending on the type of loan you have, as well as the guidelines of your particular servicer. However, many loan servicers and programs offer borrowers facing financial hardship loan forbearance, a temporary suspension or reduction of your monthly mortgage payment for a set period of time, though this period will vary lender to lender. During the forbearance period, your payments are suspended, and negative credit reporting and late charges will not occur. You may be required to apply for a forbearance or provide documentation depending on the type of loan you have. That’s why it’s important to take action as soon as you anticipate a problem making your payments.
Be Transparent and Stay in Touch.
Typically, suspended payments will be due at the end of the forbearance period – which may not be financially feasible for the borrower. If you anticipate continued challenges making your payments, contact your servicer towards the end of the forbearance period to reassess the situation and discuss other alternatives, such as paying back the forbearance amount over time or modifying your loan to add the payments to the end of the loan term. By being straight-forward with your servicer, you’re giving them the chance to offer you solutions and keep your account and your credit in good standing.
If you’re facing financial struggles because you’ve been laid-off or furloughed in the wake of COVID-19, you are not alone. But the good news is that when it comes to making your mortgage payment, you have options. Remember, the best way to handle this situation with your lender is to be proactive, explore your options, be transparent and stay in touch with your loan servicer. If your loan servicer is PrimeLending, you can contact us at (800) 597-0233 or email firstname.lastname@example.org to discuss your options with a trained specialist.