Many who are financially impacted by the coronavirus pandemic are concerned about how to make that next mortgage payment. Sarah Mann with Center City Mortgage said it’s important not to panic and to get organized.
“The first thing you want to do is always call your loan servicer,” she advised.
That’s the company you write your checks to or send your payments to monthly.
Then, she said, be honest. The borrower should tell their lender they’re experiencing a financial hardship.
“Explain to them that you would like to continue making payments but you are out of a job, or furloughed or even taking a pay cut during this really complicated time in life,” she said.
Mann said they will most likely want to work it out as no bank wants to have clients missing payments and foreclosures at the levels seen after the housing bubble burst in 2008.
“They have set up departments to handle these types of situations for people when they feel like they have fallen behind,” she explained.
She said to stay optimistic even in these extraordinary times because lenders know they will also benefit from working with their clients.
Mann also said that even though the economy is taking a hit, this can be an opportunity to improve your credit.
“This would be the time to prepare for when everything goes back to normal and you want to get into the market and buy a house,” she said.
She said the steps include making sure that you do have credit — at least one or two credit cards in your name.
“This shows healthy spending habits and fiscal responsibility,” she explained.
And especially now with layoffs and pay reductions, Mann said this is an opportunity to negotiate down principal amounts owed, monthly payments and percentage rates with credit card companies.