Millions of mortgage borrowers have already applied for loan forbearance because of the uncertainty brought by the Coronavirus Disease of 2019 (COVID-19). However, some homeowners who have called their servicers were advised that they need to make a balloon payment once the deferment period ends. A balloon payment could be overwhelming if the pandemic has affected your finances.
When refinancing your mortgage, the lender will order an appraisal to determine if your property has enough value to secure the new loan that you’re about to take. Just like homebuying, an appraisal is one of the most crucial steps when refinancing.
In this post, I’m going to educate you about what is going on in the economy. Most any economic indicator (GDP, New Home Sales, Jobless Claims, etc.) from Q1 and Q2 is going to be, in the words of Billie Eilish, “baaaaaaaaaaad.” Don’t reach for your mid-day cocktail yet, I have some good news for you.The market is already looking forward to Q3 and Q4 numbers while closely monitoring the pace at which states are opening back up and how citizens are responding. The positive news is that the amount of money being pumped into the economy through unemployment programs and the PPP will be enough stimulant to lead to better numbers in the back half of the year. Additionally, the Fed has done a phenomenal job rolling out the 2008 ready-made playbook and more since this crisis began. The circumstances surrounding this crisis—caused by a virus, and not from bad actors in the financial markets world—has allowed the Fed to act swiftly and effectively.Both Fed Chairman Powell and Secretary Mnuchin say they are ready with even more liquidity injections if needed. Fortunately, for mortgage rates, the volatility has died off, and that should give buyers a lot more confidence to lock their loans. The Fed will be careful not to say or do anything that has a chance of upsetting the apple cart for the foreseeable future. In fact, the Fed has ramped up the programs they already have in place to help areas of economic stress that have arisen and may arise going forward. For you as a potential home buyer or refinancer, it is amazing news that the Fed signaled that interest rates will be at zero until they are sure we are out of this economic overhang from the virus. As a result, it’s a great time to reach out to your mortgage professional and stay on top of exactly what is going on in the market. Whether or not we can win your business, we are happy to be an amazing resource in your home buying journey.
Three months ago, I was sitting on my couch thinking how nice it would be if I could spend every day here. Well, my dream came true! Now as the world re-opens, I can’t help but feel hesitation to get out of here, even though I’ve been desperate to get back to my favorite restaurants. Not to mention the gym! But home seems to winning again. The comfort and safety of home is undeniable which is why we should really consider homeownership from all angles in this current environment. Given that interest rates are likely to remain low for a long while, but economy may not get back to full strength for years, how do we see the prospects for the home buyer going forward?
Fannie Mae and Freddie Mac recently clarified that the lump sum repayment at the end of the loan forbearance plan “is an option for repaying missed payments”. The two government-sponsored enterprises (GSEs) also explained the other options for repaying the missed payments amid growing confusion among millions of homeowners who have sought forbearance after being affected by the Coronavirus Disease of 2019 (COVID-19) pandemic.
Quarantine life with kids at home going on SEVEN weeks, oil prices in the red, rising unemployment, the declining economy, forbearance payback terror, the corona virus crossing the one million cases mark, and the country is re-opening. Wow, that is more drama than all of Bravo’s Housewives…every city and all seasons combined.
People are often devastated when they suddenly lose their jobs. As a result of the ongoing coronavirus disease of 2019 (COVID-19) pandemic, especially affected are those who have a family to raise and monthly obligations to pay to creditors. It’s a stressful situation if you think your “rainy day fund” is not enough to cover daily expenses and bills for the next couple of months.
The right thing to do if you’re falling behind your mortgage payments due to the COVID-19 pandemic is to call your servicer. If your loan belongs to any of the government-sponsored enterprises (GSE) e.g. Fannie Mae, Freddie Mac, FHA, or VA, you could be allowed to temporarily suspend making your monthly payments.
As a homeowner, your family could be bombarded with the ongoing news on how the new coronavirus of 2019 (COVID-19) continues to impact the nation. Loss of income, job security, confusion, and health are some of the major factors that could increase your stress levels during a pandemic.
Homeowners still paying their mortgage are on the brink of missing their monthly payments when they suddenly lose their jobs. Although mortgage interest rates have become favorable, borrowers who become unemployed could not possibly refinance their current mortgage simply because lenders will most likely not be able to verify that they have a stable source of income to repay the new loan. Their financial situation could be even more frustrating if borrowers don’t expect that they could land a job again anytime soon. Some struggling homeowners, however, may find loan modification a viable option to avoid foreclosure and keep their homes.