{"id":13985,"date":"2020-09-09T16:54:54","date_gmt":"2020-09-09T23:54:54","guid":{"rendered":"https:\/\/www.rentecdirect.com\/blog\/?p=13985"},"modified":"2022-06-16T15:14:39","modified_gmt":"2022-06-16T22:14:39","slug":"landlord-resources-help-with-mortgage-and-other-financial-assistance","status":"publish","type":"post","link":"https:\/\/www.rentecdirect.com\/blog\/landlord-resources-help-with-mortgage-and-other-financial-assistance\/","title":{"rendered":"Landlord Resources | Help with Mortgage and Other Financial Assistance"},"content":{"rendered":"

\"Landlord<\/p>\n

Are you, or someone you know, a landlord needing help with mortgage payments or other financial obligations? You\u2019re not alone!\u00a0<\/span><\/p>\n

As the nation grapples with a pandemic induced recession, the trickle-down effect of the financial burdens renters face and the federal eviction ban on the rental market has cascaded into a <\/span>scramble for landlords to find funding to pay the mortgage<\/span><\/a> and other business expenses.\u00a0<\/span><\/p>\n

As <\/span>eviction moratoriums continue<\/span><\/a> through the end of the year, if dealing with negative cash flow, the below resources and rent collection suggestions may help get you through these tough times.\u00a0<\/span><\/p>\n

Mortgage Forbearance\u00a0<\/span><\/h2>\n

Simply defined, <\/span>mortgage forbearance <\/span><\/a>is requesting a modified payment plan with a mortgage lender during a time of hardship. It typically requires a qualifying event such as a pandemic related recession.\u00a0<\/span><\/p>\n

The Coronavirus, Aid, Relief, and Economic Security Act (CARES ACT) allowed suspension of payments, fees, and foreclosure relief for federally backed loans, and met its end August 31, 2020. However, some areas have put in place state or local mortgage forbearance requirements.\u00a0<\/span><\/p>\n

Until Congress passes a new national relief plan, if you are not covered by a local or state mortgage forbearance initiative, it would be up to your lender\u2019s discretion on the options available. It never hurts to reach out and ask them directly.\u00a0<\/span><\/p>\n

Working with Your Mortgage Lender<\/span><\/h2>\n

When speaking with your mortgage lender, ask about their hardship plans. Likely they will offer a few forbearance options which defer mortgage payments. In that, mortgage payments are entirely paused for 6-12 months, with an agreement to either pay it back at the end of the forbearance in full, added deferred amount divided back into the remaining mortgage period, or in the form of a new loan for the deferred portion.\u00a0\u00a0<\/span><\/p>\n

Keep in mind whatever mortgage forbearance option is available, it is not a forgiveness program and the entire mortgage is still required to be paid-in-full. It\u2019s just a creative way of payment that leaves you with a little more cash-flow during these uncertain times.\u00a0<\/span><\/p>\n

Knowing the options available to you may help you make ends meet on your other financial obligations while the eviction moratorium period is in place.\u00a0<\/span><\/p>\n

If rent payments are not coming in, having a pause on paying this expense could be a lifesaver for your rental business. Just remember, the funds are still owed, and only take the repayment option that makes the most financial sense for your projections.\u00a0<\/span><\/p>\n

Likely, a forbearance will not affect your FICO score<\/span><\/a>, but it may impact other areas of concern. It\u2019s recommended to speak to a financial advisor and accountant before making these important decisions.\u00a0<\/span><\/p>\n

Modified Loan Agreement\u00a0<\/span><\/h2>\n

Some mortgage lenders may opt to allow a reduced payment amount for a time-period with an agreement of repayment in some manner like the above. Again, these mortgage loan modifications typically require proof of hardship.\u00a0<\/span><\/p>\n

The two most common loan agreement modifications take the form of refinancing for a longer-term period or a lower interest rate. In either case, the monthly payment amounts are reduced leaving cash available for other expenses or to cover income loss.\u00a0\u00a0<\/span><\/p>\n

Options Beyond Refinance and Forbearance<\/span><\/h2>\n

A few outside-the-box ideas to get a little cash flow can come in handy.\u00a0<\/span><\/p>\n

Equity Line Of Credit<\/strong>
\n<\/span>Some homeowners who aren\u2019t interested in refinancing their mortgage or seeking forbearance are tapping into their home equity with a line of credit. Getting an equity line of credit can be faster that refinancing or working out forbearance options and gets you some cash-on-hand quickly.\u00a0<\/span><\/p>\n

Cancel Private Mortgage Insurance<\/strong>
\n<\/span>Commonly, a mortgage loan initiated with less than a 20% down payment requires paying a Private Mortgage Insurance (PMI). Those payments follow a standard two-year rule. Check to make sure your PMI has ended if beyond the two-year requirement, or give them a call to discuss exceptions; such as the amount of home equity acquired or current hardship concerns. It might not be much but that amount could then go towards the mortgage payment directly.<\/span><\/p>\n

Home Valuation
\n<\/strong>Consider contacting your county tax assessor to discuss the valuation of the home. It might require a new appraisal, but if you feel home has a significantly lower value you could see considerable savings from the reduced tax payments.\u00a0<\/span><\/p>\n

City, County, Federal Business Loans and Grants<\/span><\/h2>\n

The phone is your friend when it comes to finding local loans and grants. State and Federal resources are often sent to the city and county departments. From there, some of those are then handed over to local agencies or financial institutions for distribution.\u00a0<\/span><\/p>\n

For instance, your local <\/span>bank or credit union may be the distribution center for community grants<\/span><\/a> and might not require an account or membership. So be sure to call your city and county offices and ask about loan and grant availability and requirements.\u00a0<\/span><\/p>\n

Forgivable or low-interest loans and business grants are also available through state and federal agencies directly. Here are a few resource links researched to help<\/strong>:\u00a0<\/span><\/p>\n