Strategies to keep your mortgage payments up to date and your credit strong amid COVID-19 life.
I’m working at home today, in self isolation in Peachland, BC, and fielding more than a few calls from concerned clients.
I’ve been brokering mortgages since 2014 in the Okanagan and before that, worked in the Health Minister’s office at the Saskatchewan Provincial Legislature. Over this time, many crises have come and gone. But I’ve never seen this kind of situation before.
People are rightfully worried about recent or impending job losses, reduction to their working hours and how our nation’s mortgage lenders will respond to inevitable COVID-19 payment disruptions.
Included in this article are options you have at your disposal to navigate the current situation.
1) Talk to your mortgage broker or mortgage lender about existing skip or payment deferral mortgage clauses.
Lenders have clauses in your mortgage contract right now that allow you to skip a payment or defer a payment due to certain circumstances.
Keeping in communication with your lender is key during this time if your payments may be disrupted. Lenders will work with you to defer or skip payments and ensure that these payment alterations don’t register on your credit bureau as missed mortgage payments.
2) Lender updates
COVID-19 relief announcements have come from mortgage companies and the Big 6 banks. Respected Canadian mortgage lender First National Financial LP had this to say, “Our financial relief program will be customized to each individual’s circumstances and could include deferral of payments on mortgages for up to six months.”
These announcements correspond with social media updates from the nation’s mortgage insurance companies; CMHC, Genworth and Canada Guaranty. CMHC tweeted that it “will support lenders in allowing deferral of mortgage payments for up to six months for those impacted [by the coronavirus].”
It sounds likely that the 6-month deferral is going to happen since both the nation’s lenders and mortgage insurers are tweeting about it. However, the deferred mortgage payments plan (so far) relates to insured mortgages through CMHC/Genworth/Canada Guaranty. News articles have been clear that most payment deferral requests will be made on a case by case basis.
Click HERE for a list of contact information for major Canadian Mortgage Lenders.
Click HERE for 6 Mortgage Deferral FACTS
Click HERE for Canadian Mortgage Lenders’ COVID-19 Responses
3) Federal Government Relief – Links to benefits
The Federal Government announced a relief package today to help Canadians and Canadian businesses weather the COVID-19 storm.
LINK to OFFICIAL Government of Canada COVID-19 Economic Response Plan (Support information for individuals, businesses and industry)
Here are some details from CBC News.
$2 billion boost to Child Care Benefit
$900 biweekly for Emergency Care benefit up to 15 weeks
$5 billion Emergency Support Benefit for unemployed without EI benefits
6-month interest free moratorium on Canada student loan payments
10% wage subsidy for small business
Deferred tax payments until after August 31, 2020