Mortgage And Foreclosure Information Related To Covid
New York State and the federal government have passed laws or regulations to provide relief to homeowners who are unable to pay their mortgage due to COVID-19 or who are at risk of or in foreclosure.
This page provides information for New York residential mortgage borrowers about the relief available to them. These webpages will be revised to reflect any changes. DFS also has FAQs for industry available.
The information here relates to both federally- and state-provided relief, and there are important differences between the two relief programs, so you should contact your servicer to discuss what specific relief options are available to you. New Yorkers can also contact organizations that offer free housing counseling and legal assistance. See the Wondering where you can get help? section below.
If your servicer has denied you relief, or you are having difficulty working with your servicer, you can file a complaint with the New York Department of Financial Services. The Department can help ensure that you receive whatever relief you are eligible for. If you file a complaint about a servicer that the Department does not regulate, the Department will refer the complaint to the appropriate government office, such as the federal Consumer Financial Protection Bureau.
New Legislation Offers Additional Coronavirus Mortgage Relief
Lea Uradu, J.D. is graduate of the University of Maryland School of Law, a Maryland State Registered Tax Preparer, State Certified Notary Public, Certified VITA Tax Preparer, IRS Annual Filing Season Program Participant, Tax Writer, and Founder of L.A.W. Tax Resolution Services. Lea has worked with hundreds of federal individual and expat tax clients.
The Coronavirus, Aid, Relief, and Economic Security Act directed lenders holding federally-backed single-family mortgages to suspend borrowers’ payments for up to a maximum of 360 days if they experienced financial hardship due to the Coronavirus outbreak. Similar, but shorter forbearance was available to owners of multi-family units with federally-backed mortgages.
Subsequent legislation, including the Consolidated Appropriations Act , 2021, and the American Rescue Plan Act of 2021, as well as presidential executive actions have resulted in additional mortgage relief during COVID-19.
Verify Freddie Mac Enhanced Relief Refinance Eligibility
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Over 3.4 million homeowners saved by refinancing with HARP®, now new program FMERR is available
What is Freddie Mac Enhanced Relief Refinance ?
HARP program expired on December 31, 2018. To ensure that high LTV borrowers who are eligible for HARP program continue to have a refinance option the Federal Housing Agency launched a new program: Freddie Mac Enhanced Relief Refinance
This program is essentially an extension of HARP but with different names and slightly different requirements. Through the new program, homeowners can get a lower interest rate , get a shorter loan term, or change from an adjustable to a fixed-rate mortgage. Theres no minimum credit score needed, either.Next: Verify your eligibility
Freddie Mac Enhanced Relief Refinance
The Freddie Mac Enhanced Relief Refinance Mortgage provides opportunities to borrowers with existing Freddie Mac mortgages who are making timely payments but are unable to take advantage of the standard Freddie Mac “no cash-out” refinance offering because the new mortgage exceeds maximum loan-to-value limits.
Who is the Enhanced Relief Refinance Mortgage for?
- Borrowers who want to refinance into a more sustainable mortgage that promotes long-term homeownership success
- Borrowers looking to reduce the monthly principal and interest payment of their First Lien Mortgage
- Borrowers who are interested in potentially reducing principal and interest payment
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Q: Does The Insolvency Exclusion Apply To Amounts Discharged Under A Pra Principal Reduction
A5: The insolvency exclusion may apply to a discharge of indebtedness under a PRA principal reduction to the extent that the taxpayer is insolvent when the discharge occurs. For further discussion of the insolvency exclusion, see page 4 of Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments PDF.
What Is A Heloc
Home equity lines of credit are a revolving source of funds that you can access as you choose. HELOCs usually feature variable interest rates, depending on the lender.
HELOCs have two phases: the draw period and the repayment period. The draw period is usually 10 years. This is when you can access your available funds as you choose, and as little or as much as you may need. During this time, youll most likely only be required to make small, interest-only payments against what you borrow.
If you dont ask for an extension after the draw period, then you will enter the repayment period. Once in repayment, you can no longer access additional funds, and you must make payments to the principle, plus interest. The length of the repayment period varies, but most lenders have a 20-year repayment period. Depending on your lender, you may be offered different types of repayment options.
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What Is A Cash
A cash-out refinance is the act of replacing your current mortgage with a new one. When you refinance your home, the new mortgage may have more favorable terms, such as a lower interest rate or a lower monthly payment. Refinancing is a popular option to pursue when interest rates drop.
A cash-out refinance is essentially a new mortgage with a home equity loan amount higher than what you previously owed on your old mortgage. Once the home equity loan is disbursed, the difference between your new loan amount and current loan balance goes to your pockets. This allows any borrower to use their home mortgage to get some cash.
You must have built equity on your home in order to cash-out refinance, and you must usually leave 20% of the equity in the home if you are going with an FHA or conventional loan.
Heres an example of a cash-out refinance at work:
Current Home Value: $200,000
Equity Left in the Home : $40,000
New Loan Amount: $160,000
Cash out: $60,000
You will have to factor in closing costs when determining your maximum cash out, but this gives you a general idea. VA loans allow you to get a cash-out loan for 100% of the home value.
The money that you pocket from a cash-out loan is considered debt, so it is tax-free. Many homeowners commonly reinvest this money back into their homes, using the funds for renovations and other home improvements.
Don’t Just Stop Making Payments
If you are in a distressed situation, you may have more options than you realize. Whether your loan is backed by the federal government or a private lender, the one thing you should not do is to just stop making payments. You must contact your lender or servicer to let the company know you are having trouble making payments. Failure to contact your lender could result in many negative consequences such as additional charges, delinquent credit reports, and ultimately, possible foreclosure and eviction.
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If Am A Tenant Is Financial Assistance Available
If you are a tenant and are struggling financially due to COVID-19, visit consumerfinance.gov/renthelp for more information on what assistance is available, or call our Disaster Response Network directly at , where youll get tips on communicating with your landlord and help navigating the rental assistance application process and more.
How Covid Mortgage Modifications Work
For homeowners struggling to pay the mortgage, soaring home values offer one way out: With the U.S. housing market faces an extreme shortage of homes for sale, you could sell your home and become a renter. If thats not an ideal choice for you, the federal mortgage system says its offering lower rates and longer terms to slash payments and let homeowners keep their homes. The rundown:
The reductions apply only to principal and interest, not to other costs that might be combined with your mortgage payment, such as homeowners insurance and property taxes.
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Frequently Asked Questions On The Mimortgage Relief Partnership
How do I get mortgage relief and/or forbearance?
Michigan borrowers experiencing a financial hardship due to COVID-19 are encouraged to reach out directly to their financial institution to learn the details of the relief options available to them. Borrowers are encouraged to reach out before their loan becomes delinquent. DIFS never advises borrowers to stop paying their loan payments.
How long will the forbearance last?
The terms of a forbearance will be agreed to between you and your financial institution. Financial institutions will confirm approval and terms of the forbearance program.
How should I contact my lender to learn about my options?
Please note that financial institutions and their servicers are experiencing high volumes of inquiries and may recommend using online services, when available, for the quickest service. Loans held by a financial institution may be serviced by another company.
What if I have a federally-backed mortgage?
Lenders who service federally-backed mortgages are subject to federal rules. Borrowers with these loans may wish to visit the Consumer Financial Protection Bureau guide to coronavirus mortgage relief options.
How do I know if my financial institution is participating in MiMortgage Relief Partnership?
Where can I go if I have further questions or concerns?
Contact the Department of Insurance and Financial Services :
877-999-6442 Monday Friday, 8:00 AM to 5:00 PM
How To Refinance Second Mortgages Heres What You Need To Know
Many homeowners refinance their mortgage at least once during the lifespan of their loan. If you already have a second mortgage, you may not have considered the possibility of refinancing your second mortgage. Refinancing second mortgages may prove to be beneficial for homeowners who are looking for lower interest rates and monthly payments.
Refinancing a second mortgage is generally similar to refinancing the first mortgage, but there may be different reasons to refinance again.
If you want to learn about refinancing your second mortgage, then read on. Youll need to take some steps in order to refinance.
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What Is A Mortgage Relief Refinance
When most people think of government or Congress mortgage relief, theyre thinking of HARP the Home Affordable Refinance Program.
HARP was a government program rolled out by the Federal Housing Finance Agency in 2009. For nine years, it helped millions of homeowners refinance after being hardhit by the housing crisis.
The HARP program ended in 2018.
But many homeowners were still underwater on their mortgages especially in areas where home values have fallen instead of rising in recent years.
So Fannie Mae and Freddie Mac created similar relief programs, called HIRO and FMERR, to help homeowners refinance with little or no home equity.
The federal government also offers mortgage relief via the FHA, VA, and USDA Streamline Refinance programs. These lowdoc refinance loans dont require a home appraisal, so homeowners can refinance even if they have very little home equity or if their home values have fallen.
Relief Programs For Renters
Renters have protections during COVID, too, although theyre less robust than the relief programs offered to homeowners.
- Renters cannot be evicted until at least March 31, 2021, if they are behind on payments due to COVID-related financial hardship
- $25 billion in rental assistance will be available through state and local governments to help renters who cant make payments
To qualify for rent relief, tenants will have to meet certain conditions, including:
- The household cant make more than 80% of their areas median income
- Renters must be experiencing financial hardship related to the pandemic
- The renter must be at risk of losing their housing
Since funds will be distributed locally, tenants and landlords hoping to qualify for relief will need to check relief programs operating in their area.
For starters, check this spreadsheet of local housing programs, compiled by the National Low Income Housing Coalition, to find rental assistance programs currently operating in your state or county.
What to do if youre behind on rent
The National Low Income Housing Coalition has a lookup tool that can help renters find state and local assistance. But you must still keep in touch with your landlord if youre having trouble paying your rent.
Remember: If you forestall payments, theyll likely be due as soon as coronavirus troubles pass. So make sure you and your landlord are clear on two things:
Get the agreement in writing if possible.
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Is Congress Mortgage Relief Program Legit
Welcome to my review of Congress Mortgage Relief Program.
Have you heard about it? If you have, are you eager to find out whether it brings you any real benefits?
If you would like to know more about it, keep reading this detailed and unbiased review to get all the details starting with how the program works, its pros and cons, and whether it is legit.
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Mortgage Stimulus Programs Faq
Is there really a mortgage refinance relief program?
Two mortgage relief programs HIRO and FMERR have been put on hold because homeowners currently have so much equity that theres little need for relief refinancing. However, if you do need mortgage assistance, you still have options. Some Congress mortgage stimulus programs enacted during Covid, such as forbearance, are still available. And homeowners with FHA, VA, or USDA loans can often refinance a highLTV loan using Streamline Refi programs backed by the federal government.
Is there a government mortgage relief program?
The CARES Act and subsequent American Rescue Plan have provided mortgage relief during the Covid19 pandemic. These programs do not refinance your mortgage but let you postpone repayment while keeping your loan active. The CARES Act also created a temporary moratorium on foreclosures and renter evictions.
Does Biden have a mortgage stimulus program?
Biden has proposed several stimulus programs to help with homeownership costs. In terms of mortgage relief, he recently enacted a measure to provide mortgage assistance to homeowners with federally backed FHA, VA, and USDA loans. Under this program, qualified borrowers can modify their mortgages to get a lower interest rate and potentially reduce their loan payments by up to 25 percent. Contact your mortgage servicer to learn whether youre eligible for a loan modification.
Is the Freddie Mac Enhanced Relief program legit?
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State And Federal Unemployment Assistance
Some states have initiatives to help employers retain workers whod otherwise be laid off, and to make lives easier for those who have been and are unemployed.
Laid-off workers may be eligible for unemployment income. The amount of unemployment income youre eligible to receive varies by state.
Visit your state governments website to see what unemployment assistance is available where you are.
Those who collect state unemployment should also be eligible for an additional $300 per week in federal unemployment income, thanks to a stimulus bill passed in December 2020.
At the time the bill passed, the additional $300 was available for 10 weeks until March 14.
Additional assistance could be provided via the $1.9 trillion stimulus bill currently being debated in Congress. But as of this writing, the bill has not yet passed, and theres no guarantee it will.
Contact Your Lender To Get Mortgage Relief
No matter what type of loan you have or what government assistance may be available, contact your lender directly if you have concerns about paying your mortgage.
You don’t have to wait until you are delinquent on your mortgage, and calling before you miss a payment will likely give you more mortgage relief options. If you’ve already missed a payment when you ask for forbearance, that delinquency may show up on your credit report .
Here’s what you should have ready when you contact your lender:
An estimate of your current income .
An estimate of your current monthly expenses.
Your most recent mortgage statement.
Documentation of what caused your situation to change.
Beware of third parties offering mortgage assistance. Look for help from your lender, not from other organizations offering mortgage relief. If you want to get advice about talking to your lender, find a HUD-approved financial counselor on the HUD website. These counselors offer no-cost assistance and can help you be better prepared to call your lender.
You can also find more information on all of the programs listed above at the Consumer Financial Protection Bureau website.
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To Start Verify Your Mortgage Type
The kind of mortgage you have may determine what types of assistance are available to you.
The GSEs, Fannie Mae and Freddie Mac, deal with conventional loans.
The Federal Housing Administration insures FHA loans.
The Department of Veterans Affairs guarantees VA loans.
The Department of Agriculture offers USDA loans.
You can find out if your conventional mortgage is owned by Freddie Mac or Fannie Mae using the loan look-up tools on their websites.
To verify whether you have an FHA, VA or USDA loan, find your closing documents and look for the Closing Disclosure. In the upper right of the first page of this document, under “Loan Information,” you’ll see checkboxes indicating your loan type: conventional, FHA, VA or other.
If you can’t locate this document, try looking at your monthly mortgage statement or contacting your lender at the phone number listed on the statement.
Regardless of mortgage type, contact your lender to discuss relief options. The federal government has encouraged all lenders to support homeowners who need mortgage assistance due to hardship brought about by the coronavirus pandemic.
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