Coronavirus Update: Mortgage Deferrals, Foreclosures, & Evictions

In this update about coronavirus and real estate, I discuss mortgage payment deferrals, halting of foreclosures, and the Texas eviction stoppage. If you'd rather read than watch, the transcript is below the video.

Greetings! I'm Craig Smyser with 1835 Realty.  Over the last couple of days, I've provided some updates about how the coronavirus is impacting real estate here in Central Texas. Those have all dealt with the current market situations for buyers and sellers and for people considering entering the market as a buyer or seller. Today's update, I want to talk a little broader to a broader audience about impacts on mortgage payments and foreclosures and evictions. I certainly hope that your financial situation doesn't require you to know this or to use this, but maybe you know someone who is and you want to pass that information along.  So, first of all, there's a lot of both public and private things coming into play here, but let's take the first subject which is mortgage payment deferrals. So Freddie Mac, Fannie Mae, and FHA have all announced that they are offering, to people who are impacted, the ability to defer mortgage payments for a few months.  It doesn't mean that they're waving them that you won't ever have to pay and they're just gonna get tacked on to the end of the mortgage payment schedule. That way you don't have to send the money out right now, you can pay it to them later.  Now what you need to understand is that there are two components when you're paying your mortgage. There's the servicer and then the owner of the mortgage, two different entities in many cases. So while you might make your payment to Wells Fargo, Wells Fargo might not own your loan.  It might be owned by some other entity and that they pay Wells Fargo to handle this processing for them. So what you need to do is reach out to your servicer and find out if your loan is eligible for some sort of deferment. Don't just simply don't make the payment and think that you are granted this deferral you have to ask for it and it has to be given to you. I have a feeling it's going to be fairly easy to get these over the next couple of months.  And as long as you are in this program, if you don't make a payment it's not going to show up on your credit score.   Just be sure that if you need it, you enroll in this program through your servicer. Now there are other banks - like Bank of America is also offering this to the loans that they own. I expect that other banks are going to fall into place over the next few days, so reach out to them and if it's not available today, maybe it's available next week.  Now let's move on to foreclosures. Again, Fannie Mae, Freddie Mac, FHA, Bank of America, and other banks have all announced that they are halting the foreclosure process, which means that if you are currently in the process somewhere along the way, they are stopping it. If you are about to enter it, if you've missed a couple of payments and they were about to start the foreclosure process, they're not going to start it.  And even folks who have recently been foreclosed upon and are still living in their house, they're not going to be evicted over the next couple of months. I think that this current timeframe is slated to go through mid-May and then that may of course be expanded. Now let's look at evictions. We've got, I've got a lot of clients who are landlords. I've got some clients who are tenants and so this applies to everyone. The Texas Supreme Court has announced that through April 19, there will be no evictions processed through any court in the state of Texas. So again, if you've got an eviction that is in process, it's not going to be granted until at least after April 19, of course that date could be extended as well. If you were about to file for an eviction, you can actually still make the filing, but there won't be any hearings. There are couple of exceptions if there is imminent threat of physical harm from a tenant that kind can still proceed. But for the most part, they're going to come to a halt. So just be want everybody to be aware of these things that are going on and again, I hope you don't need to avail yourself of these.  If you do or you know someone who does please feel free to reach out to me for some more information.  You can call me at 512-650-7300, email me at [email protected], or just comment below. Hope you are doing well. I hope you're quarantining in place and that you are staying healthy.