Additional Options for Borrowers in Forbearance.
Earlier this week, the Federal Housing Finance Agency announced that borrowers taking advantage of the forbearance option offered by the CARES Act will have more options than simply to repay all of their missed payments in one lump sum. Borrower’s mortgage servicers will contact the borrower 30 days before the end of the forbearance period to check the status of the borrower’s hardship. If the hardship has been resolved, in addition to the lump sum option, the servicer will work with the borrower to set up a payment plan, modify the loan so that payments adjust to recover the lost payments, or modify the loan so that payments are added to the end of the mortgage.
Lenders Are Nervous About the Stability of Borrowers’ Income.
Standards for home loans are getting tighter every day as lenders beef up rules to ward off early defaults from borrowers losing income or jobs due to the COVID-19 Pandemic. Lenders are requiring multiple re-verifications of income and employment right up to the closing table! Many are requiring borrowers to sign an affidavit at the closing table certifying they have not been notified of a pending layoff or income reduction.
As lenders continue tightening underwriting guidelines, the MBA’s (Mortgage Banker’s Association) Mortgage Credit Availability Index dropped 16% to its lowest level since 2015. The availability of Jumbo and non-QM loans dropped a whopping 25%! This means obtaining a mortgage is becoming more difficult. All the more reason to work with the right professional with a proven track record!
THIS I Did Not See Coming…
Across the country, more and more people are struggling to pay their rent. Last week the U.S. Dept. of Justice reported an increase in complaints about landlords soliciting sexual favors in lieu of rent payments. Soliciting sex in lieu of rent is illegal, unethical, and violates a number of federal and state laws. Need I say more?
What About Mortgage Rates??
For borrowers with excellent credit, clean transactions, and conforming loan amounts, mortgage rates are stable and very low. A great many homeowners are refinancing to take advantage of these low rates!
If you’re thinking of buying a home, don’t let the Pandemic fool you; 2020 promises stable home values and low interest rates.
If you’re contemplating refinancing, even if you’ve already refinanced a year or two ago, it might be worthwhile to refinance again!
Contact me for a FREE analysis. The numbers won’t lie. I’ll help you make sense of the markets and let you know when to pull the trigger.
Warren Goldberg is President of Mortgage Wealth Advisors, a Certified Mortgage Planning Specialist®, and a published author. His interviews include Blog-Talk Radio, Newsday, The Daily News, Anton Press, and the Long Island Herald. Since 1992, he’s been sharing his financial knowledge and wealth-building strategies, including how to properly use your mortgage as a financial tool. His clients regularly express their trust and appreciation by recommending friends and family call when in need of mortgage, real estate, and financial guidance.