Home » Mortgage & Student Loan Help in the CARES Act

Mortgage & Student Loan Help in the CARES Act

Homeowners. What a blessing it is to be in the real estate business and to help people get into the homes of their dreams. While we are in this Coronavirus Pandemic our homes have become safe havens for our families. I don’t know about you but i am so grateful for my home right now. People keep using the terms unprecedented and this really is uncharted waters and nothing like we have ever seen before.

So many people in metro Atlanta and around the US are finding themselves out of work and because of that are worried about paying bills. If you are a business owner I wrote another blog post with an easy to read explanation of help and benefits from the CARES Act, https://susankliesen.com/small-business-guide-coronavirus-relief/, there is a lot of good information there that I hope you will read.

Forbearance – If paying your next mortgage payment or the one after that is keeping you up at night there is help. I have worked with RE/MAX Center since 1996 and watched a lot of different market conditions but the great recession from 2007-2013 is still fresh in my memory. There was a term that was used a little bit when a Short Sale or Foreclosure wasn’t the main option and that was the term Forbearance. Forbearance was rarely granted but I always told folks about it as an option. This new bill is offering forbearance without proof of hardship. You probably have no idea what I am talking about, so I will explain. Forbearance is where your mortgage company gives you a bit of a break so that you don’t have to worry about missing mortgage payments. The difference in now and during the great recession is that back then you would have to supply so much paperwork to prove you were in a hardship that most people just gave up, this time they require no proof of hardship. This was designed specifically by our legislators to streamline the process to help us right now and without delay. For example if you bought your home on a 30 yr mortgage and still have 25 years left. You can apply for up to a 1 year forbearance and if you are approved your mortgage payment will begin again in May 2021 and you will still have 25 years left. They aren’t wiping away the debt they are just giving you a break from the payment and giving you some breathing room. Your mortgage has to be backed by either; Fannie Mae, Freddie Mac, HUD, VA or USDA to qualify for this forbearance option. They will not assess any additional fees, interest or penalties if approved. You can be granted a forbearance on your investment properties too and if you are granted the forbearance you may not evict or charge late fees to tenants for the duration of the forbearance period.

Student Loans – This bill suspends the payment due on all federal student loans for 6 months and interest will not accrue during this forbearance. You will not receive any negative credit rating during the forbearance period.

I am a Realtor and the National Association of Realtors has put together a great easy to read explanation of all the facets of the CARES bill I am attaching that document here for your review. NAR Economic Relief Explanation

I am here to chat if you have any questions about your property or mortgage. I am not a tax professional but I can help you find one if you need help with that too. Its the time to help our neighbors and friends and I hope this helps you some.

God Bless.

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