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Natural Disasters and My Mortgage-NY, NJ, and CT Mortgage Tip

Thursday, September 14, 2017 - Article by: MEL SMITH--LENDER OF THE MONTH - . - Message

If you and your family have been affected by a natural disaster, what does it mean for your mortgage? The first step would be to contact the following organizations:-The Federal Emergency Management Agency. You can register with FEMA online, in person at a disaster recovery center or by calling 800-621-3362.-Your homeowners insurance company, additionally your flood or earthquake insurance company, if these are relevant to your situation.-Your mortgage servicer. That's the company that you send your monthly payments to. At times it may not be your original mortgage lender.

If you find that you are unable to keep up with your mortgage payment you have the following options:-If the disaster makes it unmanageable to keep your monthly payments, request your servicer for mortgage forbearance. A forbearance from your servicer permits you to suspend your payments for an agreed upon period of time.-In a forbearance agreement, you might make partial payments or stop making payments for a specified time. Under a forbearance agreement, the lender won't charge late fees or report you to credit bureaus.

If you find that you need additional aid you can also try these options:-Direct federal aid is comprised mostly of loans from the Small Business Administration. The SBA is in control of dispensing disaster related loans to both individuals and families.The SBA extends loans at favorable interest rates to replace or repair primary residences. You can borrow up to $200,000 to cover renovation or construction costs. -FEMA offers grants to supply additional funds to fill the gap between insurance payouts and SBA loans. The maximum grant is $33,300 per household for disasters. Grants can be used for expenses such as basic home repairs that aren't covered by insurance.

If my house was totally destroyed am I expected to keep paying the mortgage?The short answer is yes. If at all possible maintain your payments to maintain your credit score. The way lenders look at it is that you are liable for your loan despite your current circumstances. So do not stop making payments until you make a new arrangement with your mortgage servicer or reach out to your lender. Whether your loan is guaranteed by Fannie Mae or Freddie Mac, insured by the FHA, or guaranteed by the Department of Veterans Affairs, the servicer is expected to accommodate your needs.

We are all somehow affected by natural disasters. Our families and our homes might be directly affected. If so, keep the above options in mind and be proactive to maintain a good credit rating.

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