Exceptions are made in cases where a reduced interest rate has been granted (where the possibility of reducing the principal balance as quickly as possible and thus reducing the credit to value) or where the mode of lewdness applies for the term of the loan, i.e. a split loan in which part of the loan is parked until the expiry date , with the intention that, on that date, an appropriate refund vehicle (for example. B, asset sale) is available for full repayment of the loan. Borrowers generally do not have to pay additional interest on their leniency mortgage. The amount of interest and interest remains the same according to the borrower`s contract. Information about COVID-19 by the White House Coronavirus Task Force in collaboration with the CDC, HHS and other Agency interest groups. Visit coronavirus.gov It depends on the type of mortgage you have. GSE-backed mortgage securities, the property of Fannie Mae or Freddie Mac, are entitled to be lenient when used as rental or secondary property. However, FHA, VA or USDA loans cannot be repaid if the property is used as rental or secondary property. While a mortgage leniency agreement offers short-term facilities for borrowers, a credit modification contract is a permanent solution for prohibitive monthly payments.
With a credit change, the lender can work with the borrower to do certain things – for example, lower the interest rate. B, switch from a variable interest rate to a fixed rate or extend the term of the loan – to reduce the borrower`s monthly payments. It is extremely important to talk with your lender about leniency before you stop paying. Even if you qualify for leniency, you do not automatically benefit from this protection. You must request this and stop payments before you are officially lenient on your loan, can make you an offender of your mortgage and have serious negative repercussions on your creditworthiness. It is important that mortgage borrowers understand that they do not automatically benefit from a mortgage. They must go to their mortgage lender or service provider and ask for such an agreement. An important provision of the CARES Act prohibits the borrower from charging additional interest or credit-related fees in connection with the leniency contract. Most lenders and mortgage service providers would rather help borrowers pay off their mortgages than initiate enforcement proceedings. Therefore, when the borrower explains his current financial situation and requires a leniency agreement, most lenders are willing to enter into such an agreement with their customers, adapted to their situation and their ability to pay.