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The pandemic caused a major impact on everyone’s lives. From lost jobs to lost homes and lost loved ones, the pandemic caused ripples of impact that have lasted until the opening months of 2021. For many homeowners who lost their jobs, it looked for a time like there was no solution in sight for their strapped financial condition. Many people lost their homes during the opening days of the pandemic.
The COVID Mortgage Stimulus Program is included in the CARES Act and it was recently extended to continue beyond its proposed end date of December 2020 to allow homeowners and renters the support that they need given the current economic conditions.
If you have had trouble paying your mortgage since the start of the pandemic, this program might help you to keep your home and save your credit from being harmed by payment issues related to your mortgage.
Who is Eligible for the COVID Mortgage Stimulus Program?
The portion of the program that allows mortgage borrowers to help pay off their mortgage has qualifications that must be met. There are many other programs that are connected to this particular stimulus program, so if you do not meet the requirements for the COVID Mortgage Stimulus Program you might be able to qualify for a different program that is intended to support refinances and other kinds of relief.
To qualify for the COVID Mortgage Stimulus Program, your loan must meet these conditions:
- You own a single-family home
- You have a federally-backed or FHA-insured mortgage
- Your mortgage for 2021 must be less than $548,250
Your conventional mortgage cannot have foreclosure proceedings initiated until July 31, 2021, under this program. If you have an FHA, VA, or USDA the same timeline for July applies. There is no word as of yet if this date might be extended into the future again to try to help people to retain their homes.
There may be other qualifications that you need to meet related to your lender’s specific rules and standards for refinances and forbearance. Not every lender will be able to answer all of your needs, but you will not be able to look for another lender using the stimulus program. If you need to look for a new lender you will need to refinance.
What Does This Program Do?
This program is not a refinance program but is instead a forbearance that will allow you to stop paying on your mortgage for a set period of time. The program will let you get up to 18 months of forbearance that will hopefully allow you to catch up on your finances in other areas and go back to paying on your mortgage.
Some borrowers will qualify more readily for a regular refinance program that is supported by Freddie Mac or Fannie Mae if they do not want to proceed with forbearance. It is important to know that you will still have to pay back the missed payments that you were granted leniency for during the period allotted by the program.
When Does The Program Expire?
The program has not been set to expire again since the first end date of December 2020 was altered. There might be more information about an end date for the program later in the year from President Joe Biden.
How do I Apply for the COVID Mortgage Stimulus?
You will need to apply to your loan servicer before September 30, 2021. Some borrowers will qualify for additional relief programs that will allow them to be gifted money to help with their overdue bills and their mortgage. Your lender should be aware of all of the programs that you might qualify for besides the COVID Mortgage Stimulus. The CARES act is made up of many programs that can help you to recover financially from the pandemic.
Stimulus checks and other government assistance that are being provided to US citizens are intended to help them survive the financial setbacks that this year has caused, but this may not be enough. If your home loan is too expensive for you to afford given your current employment status, you need to make sure that you look into applying for this program as well as the other homeowner’s relief programs that are offered by Freddie Mac and Fannie Mae.
These programs are intended to help you to keep your home during these troubled times, and if you have no late payments and sufficient credit, you are probably eligible to take advantage of these benefits.