How am I going to pay my mortgage during COVID-19?
The onset of the COVID-19 pandemic has caused a lot of disruptions in every area of our lives. The global economy and individual’s finances have not been spared. Many homeowners are distraught looking for ways to pay their mortgage and other expenses during the pandemic.
If you have been so severely affected by the pandemic, and you are having difficulties paying your mortgage, you may be able to apply for mortgage deferral. We will take you through the process below.
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What Is a Mortgage Payment Deferral?
A mortgage payment deferral is a program that allows the payments for your mortgage to be paused for an agreed time frame. This mortgage option is usually activated during financial crises or hardship. Although the effects of COVID-19 are widespread in nature, you will still need to apply for mortgage payment deferral to take advantage of this option. The length of time you are able to suspend your mortgage payments will be negotiated between you and the lender. After the duration of the payment suspension, the mortgage payments will return to normal.
It should be noted that the missed payments, including principal and accrued interests, will need to be paid, normally added to the end of your term. The main impact of activating this program is that the total amount you owe after the deferral time will increase. However, if you need some relief during this COVID-19 period, this is a great option for you. Speak with a representative from your mortgage lender for additional details on how to pause your mortgage payments.
Important Information About the Mortgage Payment Deferral Program
It is essential to know that this program is not a debt forgiveness program. It is only the suspension of payments for an agreed time, lasting up to 6 months. It should be noted that only the principal and interest will be paused when suspending your mortgage payments, your tax and insurance payments will continue to be withdrawn if they are tied in with your mortgage payment.
If you are facing financial crises due to income reduction or job loss as a result of COVID-19 effects, contact your lender to better understand your options. If your mortgage payments are due within the next few days or are past due, look to speak to a representative over the phone, do not delay the process by engaging via email.
Times are tough right now, and everyone is feeling the impact of COVID-19 in some way. We suggest that you only apply for mortgage deferral if you really need it. If you need more information on this program or would like to discuss other options you can speak with your real estate agent for advice or recommendations.
