Navigating mortgage assistance through the federal CARES Act may be confusing, but Chicago Volunteer Legal Services can help.
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"The law says all you have to do is say 'I have been affected by COVID-19 and I need a forbearance.' You could even do it over the phone," said Matthew Hulstein, supervising attorney. "We recommend you do it in writing so you have proof of the request, but even then it's just a letter. And the law says no further documentation is required,"
Hulstein said homeowners can get their payments delayed for six months if they have a federally backed mortgage. Homeowners may also qualify for an additional six months, giving up to one year of mortgage forbearance.
You can see if you have a federally backed mortgage by going to www.CVLS.org and clicking on the "Get COVID-19 relief" button from the drop down menu. Just click on the click COVID-19 forbearance box to start the process. You can also email them at COVID@CLVS.org.
"We have created a new part of our website to help homeowners go in and check to see if they have a federally backed mortgage, and if they do they can download form letters and explain to the bank how they have been affected by COVID-19, and formally request the forbearance," Hulstein added.
At the end of the forbearance you shouldn't have to pay up the missed payments in a lump sum. Instead banks should extend the length of the mortgage.
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"Some banks are giving incorrect information and kind of discouraging homeowners from entering into this program," Hulstein said.
Mortgage providers such as Fannie Mae or Freddie Mac, or mortgages insured by the FHA, the VA or the USDA, will qualify.
Chicago Volunteer Legal Services will also help if you are having trouble with your bank.
"If the bank doesn't do what they are supposed to do, we even go the step further and give you a form notice of error to hopefully correct the problem and get you into that forbearance," said Hulstein.
Even if you don't have a federally backed mortgage, industry experts said your bank may still be able to work with you to defer payments to the end of your loan.