What is it?
Governor Gavin Newsom announced a deal (Business Insider, 3/25/2020) with the major banks on a 90-day moratorium on mortgage payments amidst a strong rise in unemployment filings in the pandemic.
According to Business Insider, about 200 banks including JPMorgan Chase, Wells Fargo, Citi, and US Bank agreed to the moratorium. Bank of America reportedly was not participating but said that they will provide a rolling 30-day waiver based on individual need for the duration of the pandemic.
This could provide badly needed relief for homeowners who owe mortgages on their homes.
What does it not do?
The moratorium likely applies to you if you suffered a loss of income due to:
- contracting COVID-19
- caring for someone who has contracted the virus
- cut back or loss of work due to the shelter in place order
- missing work to care for child after school closed
The moratorium does not forgive or waive the mortgage. After the 90 day moratorium (approximately 6/25/2020, if not extended and amended), the you would owe the unpaid rent in full, unless some repayment plan is worked out.
So what should you do?
If you can pay the mortgage, you should continue to pay. If you cannot for any of the above items, you should call the bank or the mortgage servicer about participation in the program as soon as possible.
They may request the following documentation:
- bank statements
- letter of termination
- letter from a former employer
- sales receipts
- order receipts
- medical bills
Photo Credit: AP via Business Insider.