TWINSBURG, Ohio — Housing advocates and lawmakers are all trying to create programs to help homeowners and keep the coronavirus pandemic from turning into the next housing crisis. But figuring out where to go is not always easy.
Like many of us, Scott and Jen Minor of Twinsburg suffered a financial hit because of the coronavirus pandemic.
While they were able to get a break from many of their creditors, Wells Fargo, the bank that owns their home loan, initially said they couldn’t get help with their payments.
"I'm not asking them to eliminate the charges," Scott explained. "I'm not asking them to eliminate anything, just push it out one month. Give me a month," he asked them.
But days later, they contacted their bank again looking to defer payments, and found out, they got a three month reprieve.
While he was relieved, Scott said, “I think if they're being helped out by our Government, which is ultimately my money and your money that's helping them out, why can't they help me out?”
Turns out, many big banks are offering help. But, it's not one-stop shopping when it comes to getting help.
For example, if you have a federally backed loan; we're talking Fannie Mae, Freddie Mac or FHA, you're protected from foreclosure for a least 60 days, which started on March 18.
You can also delay or reduce your payment for 180 days, and then for another six months if needed. You'll have to pay back the money, but they won't add fees, penalties or additional interest.
With a big bank private loan, help varies. You'll need to call and see what type of relief is being offered. However, be sure to get the terms in writing, because how you have to pay back that money varies. And what someone tells you over the phone can be very different than what ultimately happens, if it’s not documented.
If your loan is with a Servicer, a company which "collects" your payments for investors, you may be out of luck. Many are not giving breaks because they're not getting any help from the Federal Government either.
That’s why it’s critical to find out who owns your loan. You may have taken out the loan with a big Private bank, but many banks sell the loans to Servicers and that’s a game changer if you need assistance.
But, if you do get a break on your mortgage payments, you could pay a heavy price for deferring.
"This is not forgiveness of the loan. If you take the 60 day suspension, the presumption is that in June, you're going to come up with three months of mortgage payments to your mortgage company,” explains Attorney Marc Dann, who practices Consumer law.
Many people still won’t be able to do that, and you could take a hit on your credit.
But also taking a hit, are homeowners with a tenant, where both were laid off. Or, landlords who own a rental property which is paid for, and may now have to take another loan because they can’t make up the money lost from tenants who don’t pay.
It's why housing advocates say "everyone" needs more help.
Here is more information on loans and resources for housing help:
Mortgage Companies offering help to borrowers:
The Ohio Housing Finance Agency:
Save the Dream Ohio - program for those requesting foreclosure prevention assistance closed to new applications on October 31, 2019.
Renters in Federal housing/Homeowners with Federal Loans:
Fannie Mae: Personalized help for renter affected by COVID-19