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Options are Available for Struggling Homeowners

With so many employees being furloughed or laid-off due to the COVID-19 Pandemic, some homeowners in Norco may be having difficulties making their mortgage payments on time. Recent federal legislation provides relief, ensuring families can stay in their homes.

By Memorial Day, approximately 38 million Americans had lost their jobs due to the devastating economic impacts of the COVID-19 Pandemic. As a result, many homeowners are unable to meet their mortgage obligations, but various government and private sector programs offer relief for those borrowers.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act accommodates borrowers impacted by the current health and economic crisis. The Act addresses all federally-insured home mortgages, including conventional loans that have been acquired by government-sponsored enterprises Fannie Mae or Freddie Mac, as well as Federal Housing Administration (FHA) and Veterans Affairs (VA) loans. The legislation requires lenders to offer borrowers—anybody directly or indirectly affected by COVID-19—up to 180 days of forbearance (pause in payments), with the option to request an additional 180 days. The Act specifies that no late fees will be charged, nor will any adverse information be reported to credit bureaus.

To find out if your loan is eligible for forbearance under the CARES Act, you should first call the bank that sends out your monthly mortgage statement, and do not stop making payments until you have been advised to do so. Even if your loan does not qualify for CARES relief, your bank may offer its own forbearance program. It is important to remember that forbearance is not the equivalent of forgiveness, and the terms of repayment may vary. Therefore, it is critical for borrowers to clearly understand all requirements before entering into a forbearance program. Homeowners should also be on the lookout for fraudulent scam artists seeking to take advantage of distressed borrowers.

The City of Norco is exploring opportunities to use some of its affordable housing funds to directly assist struggling homeowners. This initiative will be updated as new information becomes available.

For more information, contact the City of Norco at info@ci.norco.ca.us.