Can’t Make Your Mortgage Payment? Here’s How to Request Relief 

The coronavirus pandemic and the millions of jobs lost due to it are whipsawing American households.

Once you’ve put food on the table, the next most pressing question is, “How do I hang onto my home?”

If you’re in a tight spot right now, you may qualify for mortgage relief. Following is a look at newly available types of relief for homeowners struggling during the pandemic.

Contacting your mortgage servicer

Pursuing any type of mortgage relief likely will involve contacting your mortgage servicer — the bank or other company that sends your monthly mortgage statement. How and when you contact your servicer depends on the severity of your financial hardship:

• If you can’t pay the mortgage this month: Call your mortgage servicer right away and let it know the situation. With many people in the same boat, getting help could take time. Also, NPR reports, some homeowners are having difficulty getting help. Be prepared for waits, confusion and bureaucracy.
• If you can pay the mortgage now but worry you’ll hit trouble later: Don’t call yet. Check the servicer’s website for instructions because phone lines may be jammed with people needing immediate help. Also, check the Consumer Financial Protection Bureau’s guide to coronavirus mortgage relief options.

To contact your servicer, check your monthly mortgage statement for contact information and your mortgage policy number. Failing that, use the lookup tools that the CFPB lists on its website.

Relief options for federally backed mortgages

Congress recently passed the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, which includes provisions that help people with mortgages that are federally owned or otherwise backed by one of the following federal entities:

• U.S. Department of Housing and Urban Development
• U.S. Department of Agriculture
• Federal Housing Administration
• U.S. Department of Veterans Affairs
• Fannie Mae
• Freddie Mac

The CFPB’s guide has consumer contacts for each entity.

Homeowners with federally owned or backed mortgages are offered two types of aid under the CARES Act:

1. Foreclosure moratorium: A 60-day moratorium started on March 18. You can’t be evicted or charged a fee for a late payment during this time, USA.gov says. Also, mortgage lenders and servicers may not start foreclosing on you or finalize a foreclosure during the moratorium period, the CFPB says.
2. Mortgage forbearance: Homeowners having trouble paying their mortgages because of financial hardship related to the coronavirus pandemic have the right to ask their mortgage servicers for a 180-day forbearance — meaning a temporarily lower payment amount or a pause on payments. Such homeowners also can request one forbearance extension of another 180 days.

As the CFPB explains the forbearance request option:

“There will be no additional fees, penalties or additional interest (beyond scheduled amounts) added to your account. You do not need to submit additional documentation to qualify other than your claim to have a pandemic-related financial hardship.”

The CFPB guide also explains what to expect with forbearance and how to request forbearance.

Relief options for other mortgages

If your mortgage isn’t backed by the federal government, potential sources of help include your mortgage servicer and your state government.

Contact your mortgage company to ask what relief it’s offering. Companies ranging from Bank of America to Ally have extended relief options to borrowers who are struggling during the pandemic.

As for help from state governments, check your state. Check back frequently for changes and new programs. Bankrate also has a list of state actions to help homeowners with mortgage trouble.

Refinancing is possibly another option

Another possibility may be to refinance your current mortgage. It could be worthwhile if you can lower your payments by getting a lower interest rate or extending the term (the lifetime) or your loan.

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