Dallas Fort Worth homeowners who are struggling during the COVID-19 pandemic are not alone. Across the country, industries and economies have come to a screeching halt due to the virus that has taken hold of our communities. It’s meant a lot of job loss and a lot of financial strain. We know you’re feeling it, and we hope that you and your loved ones are well.
We also want you to know that as your local property managers, you can count on us as part of your support team. Our experience in Dallas Fort Worth property management allows us to gather the latest resources and information, and we’re happy to share what we know with our owners, tenants, and community partners.
In response to the economic slowdown, the federal government has passed the Coronavirus Aid, Relief, and Economic Security Act, known as the CARES Act. This provides stimulus relief for taxpayers and small businesses, and it also helps you with some mortgage relief. That’s what we’re focusing on here.
CARES Act Section 4022: Foreclosure Moratorium and Consumer Right to Request Forbearance
When it comes to your mortgage payments, you have some new rights under the CARES Act. If you have a federally backed mortgage loan (which most borrowers do), you are protected from foreclosure if you cannot make your mortgage payments.
Talk to your lender if you haven’t already. You’ll need to certify that you’re facing a financial hardship due to the COVID-19 pandemic, and then you’ll be entitled to a forbearance. This will apply to you even if you are currently delinquent on your mortgage payments.
Your lender is required to provide a forbearance of up to 180 days, and you won’t be charged any extra fees or penalties. You can extend the forbearance if necessary, and you can also limit it to less than 180 days if you find your financial situation improves and you are ready to continue making mortgage payments.
What We Don’t Yet Know about Mortgage Relief in the CARES Act
This is an excellent program that can provide much-needed relief, especially if you are unable to meet the mortgage payments on your own home or on a home that you’re renting out to tenants. However, there are still some unanswered questions even as we’ve already entered the 180-day period of enactment.
For example, if your loan is not federally backed, it’s hard to tell if your lender will have any reason to offer the same type of payment relief. Also, it’s unclear how you’ll be expected to make up for the deferred payments. This may turn out to be at your lender’s discretion, so make sure you communicate with them. Will you have to pay one lump sum to catch up at the end of the 180-day period? Will those payments be forgiven? Will they be added on to the end of your loan term? You’ll want to discuss this with your broker or bank before you accept or apply for the forbearance.
With your own mortgage payment relief comes some responsibility to your tenants, if you’re renting out a property in Dallas Fort Worth or Tarrant County. The CARES Act includes a moratorium on evictions.
We know there are still a lot of unanswered questions remaining, and we’d be happy to talk through them with you. For anything pertaining to how the COVID-19 issue affects your rental property or any separate Dallas Fort Worth property management questions, please contact us at Assign Property Management.