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Published: March 27, 2020
How can I delay paying my mortgage without incurring additional interest or fees?
***The President signed the CARES Act into law on March 27, 2020.
**The CARES Act is still a bill, not a law yet. Today (3/27), the House is scheduled to vote to pass it,
and from there it heads to the President’s Desk to be signed into law.
*This story has been updated to include that borrowers now have a right, instead of “may be eligible,” to forbearance if the government owns or insures your home (it probably does, the government significantly dominates the secondary mortgage which is where your mortgage is bought and sold by investors). Notably, a borrower may not be charged interest or late fees on their mortgage for up to 180 days, and possibly an additional 180 days after the initial period due to COVID-19. If you want to take advantage of this, call your loan servicer and say, "Due to COVID-19, are you offering any type of relief in the form of a forbearance?" For those with Navy Federal, the process took less than 2 minutes and is completed right there on the phone.
Source: The Coronavirus Air, Relief, and Economic Security Act (CARES Act), Section 4022 (b), available here: https://www.documentcloud.org/.../6819206-CARES-ACT-FINAL-TEX...
Due to COVID-19, approximately 90% of all mortgages in the US are eligible for a penalty-free forbearance on their mortgage. This means you do not have to pay your mortgage for a certain period of time, and whatever that period of time is, will be added to the end of your mortgage. For example, if you have a 30-year mortgage and you are granted a 3-month forbearance, then your mortgage will now last 30 years and 3 months.
The Federal Housing Finance Agency, which instructs Fannie Mae and Freddie Mac (due to the FHFA having to prop up both agencies during the 2008 Recession), has issued guidance that banks that service Fannie’s and Freddie’s loans (i.e., where you send/pay your monthly mortgage payment) must offer homeowners relief in the form of a forbearance. As such, on March 23, 2020, both Fannie and Freddie announced that all their underlying loans shall be subject to a period of forbearance up to 12 months.
You can check to see if Fannie or Freddie own your loan by going here and typing in your information. But even faster, simply call your loan servicer and ask if your loan is “eligible for a penalty-free forbearance due to COVID-19.” Navy Federal’s approval process took 2 minutes and 9 seconds.