FINANCIAL DISTRESS MORTGAGE & FINANCES due to CORONAVIRUS COVID-19B ECONOMIC IMPACT
Mortgage & Finances Economic Impact of CORONAVIRUS (COVID-19)
We hope that you and your loved ones are in good health amidst the unprecedented times we are living in right now.
As a result of the economic recession triggered by the COVID-19 pandemic that is creating a global healthcare crisis, we are providing you with important, relevant and timely information. Because of the social isolation and non-essential business shut-downs and lay-offs, many are concerned about their ability to make mortgage payments.
We are already seeing a lot of inquiries and calls for help and guidance. I do anticipate that we will be seeing a high unemployment rate in the near future and that will place a large number of homeowners at risk of default and losing homes. We are directing all clients and customers to contact their current bank/lender customer service departments directly if they have liquidity concerns about making mortgage payments.
Potential lender solutions:
– Deferred payment arrangements for up to 6 months, no details yet about accrued interest though expected.
– Skip-a-payment option, which generally allows borrowers to avoid making one or more regular payments per year without affecting their credit rating, interest accrued.
– Interest only payments for a certain period.
– Adding mortgage payments to your loan for a certain period, interest accrued.
For those with high ratio insured mortgages, we also instruct them to contact their high ratio mortgage default insurance provider: Canada Housing and Mortgage Corporation / Genworth / Canada Guaranty for information about their respective programs to assist homeowners with payment relief options during financial distress.
Potential solutions through mortgage default insurance providers could be extending the amortization, reducing payments, or deferring payments for up to maximum 6 months with all these resulting in add backs to the loan. The insurer will work with the lender for solutions to avoid default and foreclosure.
Do know that Banks/Lenders do not want to foreclose on properties and will usually work with borrowers to find solutions that will keep them in their homes. Don’t delay if you have concerns but contact your lender right away before you miss a payment. If however, due to all the uncertainties, market volatility and bank’s liquidity, you are unable to find solutions such as deferred payments and accrued interest on your mortgage through your lenders direct and you find yourself at risk of losing your home, please contact your iMortgageBroker to help.
If you are still employed subject to qualifying and if there is sufficient equity in your home, we can assist you with equity take out mortgage solutions to help you free up equity in your home to have more currency liquidity. Our services are free with A lending solutions.
A reverse mortgage for those age 55 or older could also be a potential solution.
We always advise our clients during consultation to have a backup savings reserve account that will cover 6 months of living cost expenses in case of emergency, such as now.
If you have already lost your employment, there are alternative higher risk, temporary C lending solutions available for borrowers without any income due to job loss, if there is sufficient equity in the home. These types of lending solutions are expensive with lender and brokerage fees, but are normally a sufficient short term 6 to 12 months solution to help borrowers with lack of currency liquidity to weather the storm and find new employment again, at which time, when you are able to qualify again for lowest rate A lending solutions, we will refinance your mortgage back the the best and lowest rate A lender again.
Dominion Lending Centres released an excellent source of information last week on WHAT HOMEOWNERS NEED TO KNOW and that will assist you in making the right decisions for yourself and your household at this time. Find the link below.
The Government of Canada announced the COVID-19 Economic Response Plan: Support for Canadians and Businesses. This will be addressed in my regular Blog with regular updates as it develops an evolves over time.
Find the link below.
For regular updates on what is happening in the residential market, economy and developments due to the COVID-19 pandemic, please visit my blog at: http://imortgagebroker.ca/blog/
May you remain in good health, strength and peace.
We are always here for you if you have any further questions or need assistance.
Lori Richards Kovac
Dominion Lending Forest City Funding 10671
415 Wharncliffe Road South
London, ON, N6J 2M3