While one major problem facing many homeowners is dealing with insurance claims in the aftermath of Superstorm/Hurricane Sandy, there’s another long-term issue causing trouble for people whose homes have been damaged by the natural disaster — simply paying the mortgage. Relief is in sight for some borrowers as government agencies and other major lenders begin implementing programs to offer breaks on mortgage payments, among other forms of assistance.
Freddie Mac and Fannie Mae told companies that service their loans that they can offer assistance to borrowers with damaged homes, or those who may have suffered a loss of income because of the damage done by the storm, reports CNNMoney. For example, a Freddie Mac spokeswoman said some borrowers will be able to delay mortgage payments for up to a year.
Companies servicing Freddie loans can offer forbearance of up to 90 days, and all a homeowner has to do to get that reprieve is call their lender. After that, they’ll have to back up their claims for help with insurance documents, photos of damage and other proof.
For those homeowners with loans serviced by Fannie Mae, payments will be suspended or reduced for up to 90 days if they can’t pay bills on time because of Sandy, or if their property has lost value as a result of the storm.
Those two mortgage companies back about 70% of U.S. home loans and will be lending a helping hand by waiving late fees, postponing foreclosures and not reporting late payments to credit bureaus.
“We understand the disruption that a storm such as Sandy can have on people’s lives, and we’ve made it easy for our servicers to offer relief to those who need it,” said Leslie Peeler, senior vice president, for Fannie.
As for private lenders like JPMorgan Chase and Wells Fargo, they’ll extend offers to postpone payments for up to 90 days for customers in impacted areas who ask for help.
Anyone seeking help should call their mortgage company and ask what kind of assistance is available (and remember to brush up on our Do’s and Don’ts for making your case!) instead of waiting for your servicer to contact you. Call as soon as possible to discuss arrangements if Sandy has affected your ability to make payments on your home.
Even if you’re not a homeowner, the Small Business Administration says it will give loans to both homeowners and renters affected by Sandy even if you aren’t a small business. Loans of up to $200,000 are available from the SBA, and renters are eligibile for up to $40,000 to repair or replace property that was damaged or lost due to the storm.
Mortgage relief coming for disaster victims [CNNMoney]