Mark Kolb noticed an article in the Colorado Springs Gazette today titled: Most homeowners can skip mortgage payments for up to a year, regardless of what their banks say. I also found the original article available online at the Sun Sentinel by Ron Hurtibise.
A bit of a long title, but this article shares some VERY IMPORTANT ADVICE for Innkeepers holding federally backed mortgage loans.
“… about 33.4 million — are actually owned by an agency backed or controlled by the federal government, including Fannie Mae and Freddie Mac, government-sponsored enterprises that back a combined 28 million loans.”
There are a variety of ways to find out which agency services your loan.
- Call the company where you send your loan payments and ask.
- Freddie Mac [LOOKUP]
- Fannie Mae [LOOKUP]
Acorn has been advising our clients to investigate mortgage deferment options, to assist them with financial options during this time, and to prepare them for the aftermath of the COVID-19 pandemic.
Some of our innkeepers have shared a variety of responses from their mortgage loan providers.
- I can defer my mortgage payments up to 6 months, and the mortgage provider will tack on these missed payments to the end of my loan in the form of a balloon payment.
- I can defer my mortgage payments up to 6 months, and the mortgage provider will work with me to pay back this amount over a few years in addition to my regular mortgage payments.
- I can defer my mortgage payments up to 3 months, but the entirety of those 3 months of payments will be due on the 4th month after the deferment is over.
But, according to this article, if your loan is federally backed, your mortgage servicers are allowed to approve forbearance periods 90 days at a time. But innkeepers must reach out if they need to continue their deferment for another 90 days before the previous 90 days are over. This process can be repeated for up to 1 year.
At the end of the forbearance period, when you are ready to go back to making monthly payments, servicers of federally backed mortgages must give customers several repayment options:
- Repaying the missed payments as a lump sum.
- Spreading the payments over time, to be paid off in addition to regular monthly payments.
- Refinance their loans and reduce their monthly payments.
- Add the entire missed amount to the end of the loan, extending the loan by the number of missed months.
So, we encourage you to do a bit of digging, and verify what you are being told by your loan servicers is accurate. Ask questions. Get Answers.
And finally, before finalizing your mortgage deferment strategy, make sure to get your repayment options agreed upon in advance.
This situation isn’t going to last forever. We are in this together, and we want our industry to be well prepared for when travelers begin traveling again.
If you are an Innkeeper that needs help at this difficult time, give us a call at 877-226-7699. We have a variety of services and programs to support our clients, so they are prepared and working toward the future.