The Coronavirus has impacted millions of Americans across the country due to job loss and furloughs making it difficult, and sometimes impossible, for homeowners to make their mortgage payments. The U.S. government has
stepped in to offer homeowners financial relief during this unprecedented time with the Coronavirus Aid, Relief, and Economic Security (CARES) Act. With this new Act, government-sponsored agencies such as Fannie Mae
and Freddie Mac will offer forbearance agreements with protections for those homeowners in need.
What is a forbearance? A forbearance is an agreement between a homeowner and their mortgage servicer to suspend payments for a period of time. The homeowner does not incur late fees or other penalties during the forbearance. Additionally, mortgage terms are unchanged, and the homeowner agrees to make up the accrued interest and payments in the future. Typically, a forbearance will affect a homeowner's credit rating, however, there are a few differences in forbearances during COVID-19 which can be found on the Fannie Mae and Freddie Mac websites.
Loan servicers have been instructed to provide mortgage relief options which include:
Bottom line: homeowners who have the ability to pay their mortgage should do so. In the event you are unable to make a future mortgage payment, please call your mortgage servicer immediately and request assistance on forbearance under the new CARES Act.