Forbes - Help for homeowners

Your Weekly Advisor Update

A Note From Natalie:

Big help is coming to struggling homeowners in July. If you miss a mortgage payment (or several), you may qualify for a mortgage deferment. This allows people to push up to six missed mortgage payments back to the end of their loan term, at which time the total amount will be due in one lump sum. Borrowers can activate this 6-month deferment twice throughout the life of their loan.

According to new rules by Fannie Mae and Freddie Mac, borrowers won’t have to prove that they’re in financial trouble to be eligible for mortgage deferment. There’s no red tape. No bureaucratic hoops. No need to send in bank statements. You just have to have a home loan backed by Fannie or Freddie (most conventional mortgages are) and let your servicer know that you missed payments because of hardship. 

Nearly half of homeowners are currently worried about making housing payments, according to Freddie Mac’s latest quarterly housing outlook pulse survey. With foreclosure prevention programs like this one (and it’s not the only one), homeowners have options that can help them avoid catastrophe.

Very best!

Natalie

Natalie Campisi

Senior Staff Writer

Consumer Finance

Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations.

New Mortgage Policy Helps Borrowers Keep Homes After Missing Up To 12 Payments   

Beginning on July 1, mortgage servicers will have a powerful tool to help homeowners avoid foreclosure if they miss mortgage payments. 

The new mortgage deferment rule allows people to push up to six missed mortgage payments back to the end of their loan term, at which time the total amount will be due in one lump sum. Borrowers can activate this 6-month deferment twice throughout the life of their loan as long as there’s a 12-month gap between the deferments.

If you sell, transfer or refinance the property, then the unpaid balance would be due at the time of the transaction.

Borrowers must also have at least five years left on their mortgage to qualify for the deferment program. As the total amount comes due when the mortgage term ends, you should come up with a plan to pay off that lump-sum amount well in advance so you’re not unprepared when the bill arrives. 

The deferment program will be a voluntary option for mortgage servicers in July, but will become a mandatory option beginning on October 1, 2023.

Here’s what else you should know
this week:

Loans At 225% Interest? New Colorado Law Disallows Them But They’re Common

Colorado is the latest state to protect its residents from predatory nonbank lenders charging obscene interest rates. Rent-a-bank schemes are common throughout the country and are responsible for charging consumers up to 225% interest on short-term loans.

2023 Russell Rebalancing: What You Need To Know 

Investors are on Russell Rebalancing watch. On June 23, the popular Russell indexes got their annual refresh; here’s what you need to know. 

Two New ETFs Let You Trade Like A Washington Insider 

An exchange-traded fund (ETF) is a pooled investment security that acts much like a mutual fund. And now, two new ETFs will let you invest along party lines. Here’s the scoop on both. 

Contact US:

Forbes Marketplace
251 Little Falls Drive
Wilmington, DE 19808