A loan from a bank or other financial institution to help a borrower buy a home is a mortgage. The mortgage’s collateral is the home itself, which means that the bank will sell the home and recoup its money if it does not make monthly payments to the lender and defaults on the loan.
Usually, if we are in a regular state today, then that’s how it works where homeowners will be dealing with their monthly payments. However, due to the pandemic, there are many jobless homeowners, which results in financial instability.
Fortunately, the government created a project to cover everyone’s needs in this aspect. A project such as a mortgage stimulus program is extension assistance for many homeowners who struggle in dealing with their mortgage commitments.
Now, here are the following reasons why this program is beneficial to homeowners in these trying times.
Can Temporarily Pause Your Payments
Forbearance is when your servicer or lender allows you to temporarily pause the payment for your mortgage at a reduced rate or delay paying your mortgage. However, it does not mean that your balance will be erased, it will still be there, but the payment will be put on hold until you return to your regular earnings.
It is also important to note that asking for temporary pause payments is not a thing in loan-related transactions. Therefore, taking advantage of what’s included in this bill can help many homeowners fix their financial issues.
This stimulus bill for homeowners is best utilized if your house was in a state of big problems such as this pandemic. Aside from that, it is also applicable if your home is being destroyed during a flood, you had an illness or accident that raised your healthcare expenses, or you lost your job.
Zero Percent Interest
Interest in debts or loans is an issue for many homeowners. There are instances that a homeowner can be late in paying due to personal reasons, like lack of money for payment, getting busy at work, and busy doing household chores, just to name a few. The bills, if left unattended, can shock them, for it causes higher costs.
However, since we are now in a new normal, it is evident that countless jobs can be a reason for not paying bills on time. That’s why zero percent interest in your loan transaction is big.
This benefit is of considerable support for homeowners. It can make their mind at ease and lead them away from stress knowing that there is no interest, and they can pay their obligation as soon as they have money available.
The financial crisis is no longer unexpected, and this will affect countless homeowners in these trying times. Losing jobs and destruction of properties are also among the culprits. Unfortunately, many homeowners don’t get away with this easily at the moment. Being worried about what to do and finding a way to solve can be a burden as well.
However, in the mortgage stimulus program, there are relief options a homeowner can consider. The opportunities for mortgage relief depend on who owns or backs the mortgage, the services they provide, and the eligibility conditions they set.
Extension of Assistance
Being granted forbearance is a huge thing. How much more if you are allowed to ask for an extension of assistance? This is a big relief that will help homeowners big time. However, this is not a one-way process.
All you need to do is contact your servicer and ask what additional assistance you are eligible to avail yourself and the requirements needed for it. This applies when the payment deadline is over, and homeowners still can’t settle their obligation. They can extend it for their relief.
In some cases, the servicer may offer additional assistance to lessen the monthly expenses or some other way regarding the loan. This is another way that homeowners can benefit from their needful times.
Quick and Easy Access
People don’t like hassle processing, like having to go to different offices just to find answers to their questions, especially now that the threat of COVID-19 is still around the corner. In this program, the servicer may be one call away. Just dial the customer service number, and homeowners can lay down their concerns.
For example, a homeowner can contact their servicer to help avoid foreclosure. The servicer can then expose different ways to solve it. Without using a lot of energy and effort, they can save their home from foreclosing.
The government will take care of its people, for it is their utmost duty. That is why they are eager enough to make plans and programs that could help their people, especially amid COVID-19. In these trying times, it’s good to take advantage of projects that the government created to aid many homeowners.