Coronavirus pandemic crisis is causing huge economic problems in affected countries. One of the problems is loan repayments, especially mortgage loans. Homeowners, who have a mortgage loan and have lost their income due to isolation rules, today are facing a big concern. Are they going to lose their homes?
It seems that the USA has found a solution to this problem. Federal regulators have planned to influence mortgage lenders to offer to this category of homeowners the possibility to re-schedule loan payments. Their proposal is to offer up to 12 months of a grace period on mortgage payments.
How the mechanism will work?
It will start with the two mortgage giants Fannie Mae and Freddie Mac, which cover almost half of mortgage loans in the USA. They are ordering lenders to offer such flexibility to homeowners directly affected by coronavirus crisis.
Each borrower has to call its lender and to work out a new payment schedule, based on the particular individual situation. It is not clear when the papers will be signed, but it will probably happen after the isolation period comes to an end.
Each borrower who will undergo the procedure of mortgage re-scheduling, will not be considered a delinquent will not be registered as a bad borrower at the credit register.
A great plan, I believe, that will release from additional stress many Americans in these difficult times.
What about people who Rent their Houses?
But, there is another category of citizens not covered by this plan: the renters. Again we are talking about people who lost their jobs due to the crisis. Are they going to be left homeless on the street? It sounds very ironic to see people getting out of their houses, exactly at the time when authorities are strongly requesting people to stay inside their homes.
Let's hope a new solution will be produced for renters as well. And, other countries will follow the USA example to not forget social problems caused to people by the terrific coronavirus crisis.
Source
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