Mortgage Help Tips for the COVID-19 Pandemic
Most homeowners have reported that mortgages account for a major share of their monthly expenses. Due to the COVID-19 pandemic, homeowners face various challenges related to job security and managing their cash flow to pay back the loan.
In hopes of stimulating the economy, the US Federal Reserve immediately reduced its interest rates to almost 0% after the onset of COVID-19; however, a trickle-down effect was observed since mortgage rates do not directly relate to the federal directives.
Mortgage Rate Volatility: Expert Advice
Financial experts recommend homeowners take a holistic approach if they are struggling with bill payments and cannot meet mortgage deadlines. If you are a homeowner struggling with your payments, you should contact your lender immediately to understand your relief options. Many credit card companies offer a no-interest grace period without fees to allow customers to free their cash without worrying about credit card payments.
Some lenders also offer forbearance options that you can consider as a temporary alternative for short-term liquidity. While selecting this option, homeowners still need to feel complete future financing, as the mortgage needs to be repaid. Additionally, forbearance may affect the FICO score and negatively impact you if you cannot refinance the mortgage within the time limit.
Another solution for a mortgage payment is refinancing the loan. Some drawbacks of this option are that refinancing is a long process, and the savings may not be available immediately. Moreover, refinancing may result in additional debts that must be paid later. Before selecting any of the above options, it is important to consider all the income and cash sources and your expenditures.
Is It A Good Time To Buy A Home?
Purchasing a home amidst the pandemic is a decision you should make after carefully considering your income and economic conditions. A stable job offers an excellent opportunity to get a new home. It is crucial to understand that housing prices have remained affordable for almost a decade. Hence, you can take advantage of the pandemic and receive comparatively low interest mortgage rates if you have the finances to pay down.
Before the onset of COVID-19 in the US, spring home sellers had already listed their houses in the market. Today, even if the current number of homes for sale may be limited, so is the competition to buy them. As many buyers are pushing out their home-buying search due to limited capital, this can be a good opportunity to buy a new home if you have financial backing.
Seek Help from Mortgage Professionals
Lenders and mortgage agencies have changed pre-market requirements to accommodate COVID-19 safety regulations while assisting buyers and refinancers. Hence, it is best to seek help from a knowledgeable mortgage professional who can help you navigate the new rules and understand what guidelines apply to your transactions based on your mortgage type and state rules. Analyzing your finances and mortgage rate volatility can be difficult based on the current economic situation. Still, experts such as Rex Homes professionals can help you navigate smoothly through this rough climate.
You can read more about how Rex Homes can help you through this process on their blog here: https://blog.rexhomes.com/mortgage-rate-volatility-helpful-advice-from-the-pros/
