Coronavirus (COVID-19) and Mortgage Problems

Last Updated On: 5/7/2020 12:04:08 AM

What if I can’t pay my mortgage? Is there any help available for me?

If your mortgage is “federally-backed” (a loan purchased, securitized, owned, insured, or guaranteed by Fannie Mae or Freddie Mac, or owned, insured, or guaranteed by  FHA, VA, or USDA), Congress passed the CARES Act which may:

  • provide you foreclosure relief, or
  • reduce or pause your monthly mortgage payments.  
If your mortgage is not a federally-backed mortgage like the ones listed above, it is owned by a private bank. If that is the case, call your mortgage servicer.  Your servicer is the company or bank you send your mortgage payments to every month. Your servicer may offer relief options. Contact your servicer right away and ask for information and options directly from them.   

How can I find out who owns my mortgage?

You can request this information from your mortgage servicer by calling it or by sending a written request asking for the owner of your loan, or you may be able to look it up online if it is owned by Fannie Mae or Freddie Mac. 

This link will help you with the ways to find out who owns your mortgage: https://www.consumerfinance.gov/ask-cfpb/how-can-i-tell-who-owns-my-mortgage-en-214/.

Do I have to pay my mortgage during the Coronavirus outbreak?

Yes, unless you have a federally-back mortgage and you request a forbearance.

If your mortgage is not a federally-backed mortgage and you can’t pay, call your mortgage servicer. Your servicer may offer relief options. Contact your servicer right away and ask for information and options directly from them.  

Is my home subject to foreclosure during this Coronavirus period?

The federal government authorized a 60-day halt on foreclosures for federally-backed mortgages on March 18, 2020. That halt will last from March 18, 2020, to May 18, 2020. The halt applies to new foreclosures and foreclosures that had already started.

This protection does not apply to private bank mortgages.  If you have a private bank mortgage, and they are scheduling a foreclosure during this time, contact Mountain State Justice at 304-344-3144 or a private attorney who may be able to evaluate your legal claims as a result of the mortgage servicer’s or lender’s actions.  

What does forbearance mean?

Forbearance means that your mortgage servicer or lender allows you to pause or reduce your mortgage payments for a limited amount of time. Forbearance doesn’t lower what you owe towards your mortgage, any payments that are reduced will have to be made up in the future. 

How can I get a forbearance on my mortgage?

If your mortgage is federally-backed, you have the right to request a forbearance by doing the following: 

  • Submit a request to your servicer; and
  • Affirming that you are experiencing a financial hardship during the COVID–19 emergency. 

No other documentation is required.

Upon providing the request to your servicer, you are entitled up to a 180 day forbearance from your mortgage servicer or lender. Before the initial 180 days expires, you also have the right to request one extension of up to another 180 days. During this forbearance time, no fees, penalties, or interest beyond the amounts contractually scheduled will accrue on your loan.

If you have a private bank mortgage, your servicer does not have to offer forbearance options. But your servicer may voluntarily offer forbearance or have other COVID-19 related options. Contact your servicer right away and ask for information and options directly from them.  

What do I do after I get mortgage relief?

  • Get the details of your mortgage relief in writing. Ask your mortgage servicer or lender for a payment schedule, when your forbearance payments will be due, and if you will have additional payments at the end of the mortgage to make up for the payments you missed during the forbearance.
  • Keep all documentation that you receive from your mortgage servicer or lender that explains your mortgage relief.
  • Keep an eye on all deadlines, including the end of the first forbearance deadline. Make sure you know the payment schedule of your mortgage, especially if it gets adjusted.
  • Contact your mortgage servicer prior to the end of the forbearance period to request assistance for making the missed payments.
  • Beware of scams. Do not give any information to anyone other than your mortgage servicer or lender.
If your mortgage servicer or lender is making it difficult with your forbearance request or other loan assistance request, or scheduling a foreclosure, contact Mountain State Justice at 304-344-3144 or a private attorney who may be able to evaluate your legal claims as a result of the mortgage servicer’s or lender’s actions. 
This is general legal information. For guidance about your situation, talk to a lawyer.