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What to Do if You Can’t Make your Rent or Mortgage Payments

If you or someone you care about is in the position of not being able to work from home and are facing furloughs or job loss, you’re not alone. Millions of U.S. households are expected to face financial hardships as a result of the global pandemic. Fear can be a paralyzing force, but knowledge is power. Below is a brief list of actions that can and should be taken immediately to get in front of securing your housing while the shelter-in-place mandates are in effect. 

Guidance for Homeowners

Step one is get in touch with your lender. Guidelines from the Federal Housing Finance Agency speak specifically to loans owned by Fannie Mae, Freddie Mac and the Federal Home loan banks, but each major lender should now have or is working on their own set of guidelines to help. Available relief includes waived late fees, without delinquencies showing up on your credit reports down the road (and destroying your credit). If you are having trouble catching up at the end of the temporary relief period, additional help may be available.

Many banks are already putting together coronavirus response pages, including: 

The advice from the experts is to avoid waiting until your mortgage is past due. Know your options in advance and get in front of upcoming financial challenges before they become critical. As stay-in-place mandates continue and expand nationwide, having a game plan you can enact will help you feel more in control and ease anxiety. 

Guidance for Renters

Get in touch with your landlord as soon as possible and work out partial payment plans or the possibility of skipping a month. Most landlords will be willing to work with tenants who have been paying regularly and are experiencing hardships far beyond their control. Try this to get started: “Mr. Landlord, will you be willing to accept half payment this month, which I can add to my rent beginning in May or June?” – or whatever is realistic for your situation. Be clear, so that your landlord understands you aren’t requesting rent forgiveness, but deferment.

Keep in mind, most landlords have their own mortgages and bills to offset with the rents they collect. The sooner they have notice, the better they can plan for their own finances. Do your best to approach the conversation with compassion, as many landlords have their own jobs, families and financial challenges at this time. If your landlord can’t or won’t work with you, contact your local United Way by dialing 211 to see if they are offering rent assistance. Many banks are also offering help to their customers, which you should definitely take advantage of if you need it.  

California Governor Announces Major Financial Relief Package

California Governor Gavin Newsom announced March 25 that financial institutions are providing relief to Californians economically affected by the pandemic. Highlights include:

  • A 90-day grace period for mortgage payments
  • No negative credit impacts as a result of using relief
  • Moratorium on the initiation of foreclosure sales or evictions
  • Relief from fees and charges

You can find more details, including steps for application, here. Still, move one is to speak directly with your lender or landlord – and the sooner, the better.  

Housing Should be Your Top Priority

Once you’ve made a plan for keeping the roof over your head you can deal with credit card and utility companies. Bank of America is offering credit card payment deferrals and various utility companies are stepping up to waive late fees or make payment plans.

Again, the key to making all of this work is by being in front of it. Don’t pull the covers over your head and fall back to sleep. If you know that you can’t make rent or you may miss a mortgage payment as a result of COVID-19, don’t wait. Reaching out now is a far better strategy than waiting for the fallout.

Need Guidance?

If you need someone to talk you through this, please reach out. I’ve been through some financial hardships in my day and I’ve helped many of my clients navigate those treacherous waters. I know the toll that financial stress can take. I’m happy to help you with a script for your landlord or to be a resource to your lender.

And one last tip – beware of scams! The nefarious element that is ever-present in our world today is taking advantage of the crisis to play on people’s fears, so be awake and aware of any calls you get that don’t sound quite right or emails promising you relief in exchange for your personal information, blood type, and first-born.

Be safe and stay healthy! 

CalBRE #01224570

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