Italy has experienced the highest level of outbreak in the world of COVID-19. According to Johns Hopkins University, Italy has over 15,000 cases, and more than 1,000 people have died.
As a result, Italy is, so far, the only government to introduce a plan to suspend mortgage payments and other bills for people affected by the coronavirus pandemic lockdown. Unfortunately, this is not a viable option in America.
America’s mortgage market is around $11 trillion in mortgages compared with Italy’s $423 billion of outstanding home-loan debt. Additionally, most American mortgages are packaged into bonds with legal terms to determine if they can offer forbearance. An agreement to let borrowers either pay at a lower interest rate or suspend payments temporarily because of a hardship is on a very case-by-case basis. Any missed or reduced payments will still need to be paid off during the remaining years of a loan, with interest.
“To meet the needs of borrowers who may be impacted by the coronavirus, last week Fannie Mae and Freddie Mac reminded mortgage servicers that hardship forbearance is an option for borrowers who are unable to make their monthly mortgage payment,” said FHFA Director Mark Calabria. “For borrowers that may be experiencing a hardship, I encourage you to reach out to your servicer.”
If our team at Focus Capital can be of any assistance, please call us. We are dedicated to providing answers to your concerns and coming up with personalized solutions. We are a resource for everyone in the mortgage industry who has questions on difficult situations and on complicated loans. We understand these uncertain times create anxiety. Hopefully it is reassuring to know we are all in this together.
As a result, Italy is, so far, the only government to introduce a plan to suspend mortgage payments and other bills for people affected by the coronavirus pandemic lockdown. Unfortunately, this is not a viable option in America.
America’s mortgage market is around $11 trillion in mortgages compared with Italy’s $423 billion of outstanding home-loan debt. Additionally, most American mortgages are packaged into bonds with legal terms to determine if they can offer forbearance. An agreement to let borrowers either pay at a lower interest rate or suspend payments temporarily because of a hardship is on a very case-by-case basis. Any missed or reduced payments will still need to be paid off during the remaining years of a loan, with interest.
“To meet the needs of borrowers who may be impacted by the coronavirus, last week Fannie Mae and Freddie Mac reminded mortgage servicers that hardship forbearance is an option for borrowers who are unable to make their monthly mortgage payment,” said FHFA Director Mark Calabria. “For borrowers that may be experiencing a hardship, I encourage you to reach out to your servicer.”
If our team at Focus Capital can be of any assistance, please call us. We are dedicated to providing answers to your concerns and coming up with personalized solutions. We are a resource for everyone in the mortgage industry who has questions on difficult situations and on complicated loans. We understand these uncertain times create anxiety. Hopefully it is reassuring to know we are all in this together.
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