U.S. Orders Up To A Yearlong Break On Mortgage Payments

[mystery-ak]

U.S. Orders Up To A Yearlong Break On Mortgage Payments

March 19, 20202:03 PM ET
Heard on Morning Edition

Chris Arnold


Updated at 2:49 p.m. ET

Homeowners who have lost income or their jobs because of the coronavirus outbreak are getting some relief. Depending on their situation, they should be eligible to have their mortgage payments reduced or suspended for up to 12 months.

Federal regulators, through the mortgage giants Fannie Mae and Freddie Mac, are ordering lenders to offer homeowners flexibility. The move covers about half of all home loans in the U.S. — those guaranteed by Fannie and Freddie. But regulators expect that the entire mortgage industry will quickly adopt a similar policy.

Under the plan, people who have suffered a loss of income can qualify to make reduced payments or be granted a complete pause in payments.

more
https://www.npr.org/2020/03/19/818343720/homeowners-hurt-financially-by-the-coronavirus-may-get-a-mortgage-break

[sneakypete]

Hmmm,my house is paid for,so should I go to the bank and refinance it for 1 year?

[truth_seeker]

Hmmm,my house is paid for,so should I go to the bank and refinance it for 1 year?

my wife suggested dayss ago cash out at zero interest

[libertybele]

U.S. Orders Up To A Yearlong Break On Mortgage Payments

March 19, 20202:03 PM ET
Heard on Morning Edition

Chris Arnold


Updated at 2:49 p.m. ET

Homeowners who have lost income or their jobs because of the coronavirus outbreak are getting some relief. Depending on their situation, they should be eligible to have their mortgage payments reduced or suspended for up to 12 months.

Federal regulators, through the mortgage giants Fannie Mae and Freddie Mac, are ordering lenders to offer homeowners flexibility. The move covers about half of all home loans in the U.S. — those guaranteed by Fannie and Freddie. But regulators expect that the entire mortgage industry will quickly adopt a similar policy.

Under the plan, people who have suffered a loss of income can qualify to make reduced payments or be granted a complete pause in payments.

more
https://www.npr.org/2020/03/19/818343720/homeowners-hurt-financially-by-the-coronavirus-may-get-a-mortgage-break

????  People are losing their jobs temporarily until the go ahead is given for restaurants and business to open back up ... so 12 months seems like quite a lengthy time -- in the meantime are the feds going to float the mortgage companies for a year?? Or are they anticipating things not getting back to any semblance of normalcy for at least a year?

[libertybele]

my wife suggested dayss ago cash out at zero interest

Except mortgage rates have risen even though the feds lowered the interest rate to zero.

https://www.marketwatch.com/story/mortgage-rates-surge-to-highest-level-since-january-even-though-the-fed-just-brought-interest-rates-to-0-heres-why-2020-03-19

[GtHawk]

Hmmm,my house is paid for,so should I go to the bank and refinance it for 1 year?

Hey, I'm renter now after having lost my house under Obama's misadministration, no one offered me a years break back then, but I want to know how come no one cares enough about my vote to give me a break on rent and drive my landlord into bankruptcy?

[Cyber Liberty]

Hey, I'm renter now after having lost my house under Obama's misadministration, no one offered me a years break back then, but I want to know how come no one cares enough about my vote to give me a break on rent and drive my landlord into bankruptcy?

Because you'd probably piss your vote away on some politician who isn't handing out taxpayer-funded candy at the street corner.  It's the same with money:  The Rats want more of yours, because you'd have just wasted it on things they don't approve.  They're so much smarter than us children.

[Fishrrman]

bele wrote:
"12 months seems like quite a lengthy time -- in the meantime are the feds going to float the mortgage companies for a year?? Or are they anticipating things not getting back to any semblance of normalcy for at least a year?"

Maybe they've been told something that we haven't...

[sneakypete]

bele wrote:
"12 months seems like quite a lengthy time -- in the meantime are the feds going to float the mortgage companies for a year??

@Fishrrman

I think that is the plan.

Then at the end of that year they are going to hit them up with bankruptcy court papers and sell off their assets to the highest bidders,who just happen to be globalist billionaires that financed political campaigns.

[Cyber Liberty]

bele wrote:
"12 months seems like quite a lengthy time -- in the meantime are the feds going to float the mortgage companies for a year?? Or are they anticipating things not getting back to any semblance of normalcy for at least a year?"

Maybe they've been told something that we haven't...

It can take somebody who misses a Mortgage payment months to get paid back up, so the ripples will probably last the whole year.  I've had friends over the years who have had this happen to them, through no fault of their own.

[NavyCanDo]

Why not IF NEEDED let the home owner slide 6 months to a year of the P&I to the back of the loan.  In the event of a layoff or temporary plant closure it would allow most homeowners to stay in their home.

[GtHawk]

Because you'd probably piss your vote away on some politician who isn't handing out taxpayer-funded candy at the street corner.  It's the same with money:  The Rats want more of yours, because you'd have just wasted it on things they don't approve.  They're so much smarter than us children.

I think we all recall Crooked Willie promising everyone a tax rebate and once he was safely elected telling all of America that he couldn't do it because we would just waste the money.

[cato potatoe]

This is just a confidence builder.  The government is causing a depression.  Fannie / Freddie can't possibly backstop the cascade of defaults.

[EdinVA]

This is spin to make the taxpayer think they are being helped.
During the last housing crisis, folks were refinancing their houses because the bank would lend them more than they could sell them for, then abandoning the house and keeping the cash.  The home financial industry took a beating and sold those homes for huge loses.  The industry is positioning themselves to keep the same loses from happening and using it to "help us out".

[truth_seeker]

Why not IF NEEDED let the home owner slide 6 months to a year of the P&I to the back of the loan.  In the event of a layoff or temporary plant closure it would allow most homeowners to stay in their home.

Good ideas.

The stock market is psychology in large part. Institutional, small businesses and individuals  might fare better, if their heads got better.

The heavy burden of uncertainty starts to lift, with more positive looks to the future.

[Cyber Liberty]

Good ideas.

The stock market is psychology in large part. Institutional, small businesses and individuals  might fare better, if their heads got better.

The heavy burden of uncertainty starts to lift, with more positive looks to the future.

This certainly reduces the fear that most of us are a few paychecks away from losing our homes.  Getting an indeterminate layoff can cause that great fear in people, relieve that pressure and lives improve in immeasurable ways. 

This was the biggest reason one of my top retirement goals was to have a paid-off house to live in.  I'm in the Castle now, after owning a house in the city long enough to have paid that mortgage off early. 

[truth_seeker]

Here's a strategy.

Use leverage. For a time your Portfolio of investments and real estate equity is down.

 If you get mortgage loan forebearance (or refi-cash out), use that money, to buy more stock at current lower prices.
Anybody that sold real estate and investments following the 2008-2009 crash, missed the increase when they returned to well above their prevvious highs.

That presumes of course you don't panic. That retirement is awhile in the future, or you are already financially stable.

Think long term. Warren Buffett didn't trade short term. He bought (and held)  long term.

Have faith in America. Have faith in our economy & investing.


 

[Cyber Liberty]

Here's a strategy.

Use leverage. For a time your Portfolio of investments and real estate equity is down.

 If you get mortgage loan forebearance (or refi-cash out), use that money, to buy more stock at current lower prices.
Anybody that sold real estate and investments following the 2008-2009 crash, missed the increase when they returned to well above their prevvious highs.

That presumes of course you don't panic. That retirement is awhile in the future, or you are already financially stable.

Think long term. Warren Buffett didn't trade short term. He bought (and held)  long term.

Have faith in America. Have faith in our economy & investing.

The only problem I see taking the forebearance with that is the principle of the unmade payments gets added onto the end of the Mortgage schedule, with interest compounded from now.  That's a major piece of change if one still has 25 years to go.  But...it's 25 years down the road, so there's that.

[dfwgator]

Trying to be the economy in deep cryogenic freeze, so they can thaw it back out when this is over.

[Cyber Liberty]

Trying to be the economy in deep cryogenic freeze, so they can thaw it back out when this is over.

It might be a laudable goal, it's impossible to accomplish.  There will be pain.

[libertybele]

This certainly reduces the fear that most of us are a few paychecks away from losing our homes.  Getting an indeterminate layoff can cause that great fear in people, relieve that pressure and lives improve in immeasurable ways. 

This was the biggest reason one of my top retirement goals was to have a paid-off house to live in.  I'm in the Castle now, after owning a house in the city long enough to have paid that mortgage off early.

We sold our "castle" and downsized when my hubby retired.  We paid off all of our credit cards. We have no mortgage.  No debt. I am so glad we did that, especially now with so much uncertainty.

[catfish1957]

Hmmm,my house is paid for,so should I go to the bank and refinance it for 1 year?

Yep.  Savers and responsible people again get penalized.  Sure hope the bank doesn't see this as an excuse not to see this as a break not to make CD payments to customers. 

[truth_seeker]

The only problem I see taking the forebearance with that is the principle of the unmade payments gets added onto the end of the Mortgage schedule, with interest compounded from now.  That's a major piece of change if one still has 25 years to go.  But...it's 25 years down the road, so there's that.

So what about Buffett's strategy?

What about buying low as an opportunity?

It follows the well known life strategy:

If you want to be rish do what rich people do.

If you want to be successgul, do what successful people do.

Health.

Professional life.

Financial wellbeing

Spiritually.

[DB]

Hmmm,my house is paid for,so should I go to the bank and refinance it for 1 year?

That would be a hell of a monthly payment on a 1 year mortgage...

[Cyber Liberty]

So what about Buffett's strategy?

What about buying low as an opportunity?

It follows the well known life strategy:

If you want to be rish do what rich people do.

If you want to be successgul, do what successful people do.

Health.

Professional life.

Financial wellbeing

Spiritually.

That's a reasonable outlook.  Personally, I would not go into debt to finance an investment strategy.  YMMV.