Thursday, Feb. 18, 2021
As a result of the continued hardship from the COVID-19 pandemic, the Biden administration announced Tuesday an extension of a foreclosure moratorium through the end of June.
This means there would be no home foreclosures for federally backed mortgages until July. The window for enrolling in mortgage forbearance would be extended to June 30, and homeowners in need could potentially receive an additional six months of mortgage forbearance.
While Tuesday’s action affects homeowners rather than renters, there is a separate program that provides rental assistance.
The efforts to help both homeowners and renters are detailed below.
Homeowners
Tuesday’s announcement applies to homeowners with a federally backed mortgage who are having trouble making payments. These include mortgages from the Department of Housing and Urban Development, Department of Veterans Affairs and Department of Agriculture.
Earlier in the month, the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, announced an extension of its eviction moratorium until March 31 and an additional three months of forbearance for qualifying borrowers.
Together, the actions cover 70% of existing single-family home mortgages, according to The White House.
Mortgage forbearance is when your mortgage servicer (the entity that you make payments to) allows you to pause or reduce your mortgage payments for a limited time. For example, the FHFA payment deferral allows borrowers to repay missed payments at the time the home is sold, refinanced or at mortgage maturity.
For homeowners who don’t have a Fannie Mae, Freddie Mac, FHA, VA or USDA loan, there is discussion of relief in the new stimulus bill. Currently, the American Rescue Plan creates a Homeowners Assistance Fund that would provide $10 billion to help struggling homeowners catch up on mortgage payments and utilities.
If you are struggling to make your payment, reach out to your servicer as soon as possible to ask about setting up a forbearance program. Homeowners can visit ConsumerFinance.gov/Housing for more information about their relief options.
Renters
One in five renters is behind on rent, according to the Census Bureau’s Household Pulse Survey.
Fortunately, there is help for renters to meet their obligations. As part of Congress’ December stimulus package, Utah has received at least $200 million for rental assistance and has a rent relief program for renters adversely affected by the pandemic.
The rent relief program helps renters who are unable to pay for rent and utilities because of a loss of income related to the pandemic. The assistance money — up to $2,000 a month for up to 12 months (or 15 months in certain circumstances) — can be used to pay rent, late fees and utilities (water, sewer, electrical, gas). Renters can also use the assistance to pay for past rent payments going back to March 13, 2020.
To qualify, renters must have a combined gross income at or below 80% of the area median income. Additionally, renters must show a risk of housing instability and must be party to a lease agreement.
Renters will apply through the housing agencies listed at RentRelief.Utah.gov. Information about the program is also available by calling 2-1-1.
Rent assistance will be paid directly to the landlord while utility assistance goes directly to utility companies.
The program is subject to change and no assistance will be approved after June 30, 2021. President Biden’s proposed COVID-19 relief package also aims to provide additional funding for rental assistance.
Whether you are a homeowner or a renter, if you are having trouble making your payments, there is help. Make sure to reach out immediately to learn more about your options.
To learn more about the latest housing news, contact a local Realtor.
Thursday, Feb. 4, 2021
Winter isn’t typically the hottest season for the real estate market, but a new study suggests that the months of December, January and February may be the best time of the year to get a mortgage.
A new study from Haus, a home-finance start-up, said January offers the best rates followed by December then February.
The company analyzed Freddie Mac loan data of 8.5 million mortgage originations between 2012 and 2018 and found that rates are about 20 basis points lower in January than they are in June — real estate’s hottest month.
In second place was December with rates 18 basis points lower. The third-best month was February with a 14-basis-point discount compared to June.
“While we can’t say for exact certainty why rates are lower in January than in the summer months, we can speculate that competition for customers matters,” wrote Ralph McLaughlin, chief economist and senior vice president of analytics at Haus, in a report about the study. “Since home buying and refinancing is seasonal, there is less mortgage origination in winter months, so it could be that lenders must lower their rates to stay competitive and attract business.”
If the study’s conclusions are accurate, this year’s winter buyers could see a double benefit: that from seasonally low rates as well as from the pandemic-induced record-low rates. In fact, Freddie Mac’s weekly survey of mortgage rates showed the 30-year fixed-rate mortgage averaging 2.73% this week — a near record low.
However, buyers may need to act quickly as some economists have warned that rates may rise in the coming months.
If you’re in the market to buy a home or get a mortgage, here are a few tips for getting the best rates possible:
Shop for rates
Mortgage terms are confusing and comparing lender and third-party fees can sometimes be difficult, but it’s worth making the extra effort to reap the savings.
Looking at the country’s largest lenders, the Haus study found a 75 basis-point spread between rates — even taking into account factors like down-payment size, existing debt and credit score.
“So this means that, all else equal, the same borrower would get a 5% rate with the most expensive lender and a 4.25% rate with the least expensive lender,” McLaughlin wrote.
Visit the Federal Trade Commission’s website, Consumer.ftc.gov, to learn more about how to shop for a mortgage.
Work on your credit
The Haus study also found that credit scores do matter. For those who had excellent credit — scores above 800 — they received mortgages that were 42 basis points lower than those with scores under 650. Even raising a score from under 650 to 750-799 resulted in rates that were 41 basis points lower.
Check out your credit report at AnnualCreditReport.com to make sure all of your financial-related information is accurate.
Work with a Realtor
Another benefit of house-hunting in the winter is the fact that there are usually fewer buyers, which means less competition for the homes for sale. Typically, winter sellers are also motivated to sell quickly.
Although this year’s unseasonably active market may be an exception to the usual trends, a Realtor can help you navigate through the process. This includes helping you understand current market conditions and working as a negotiator to help you get the best terms possible.
A Realtor can also give you the names of several lenders to help you get started as you shop and compare mortgage rates.
To learn more about getting into Utah’s real estate market this winter, contact a local Realtor.
The Utah Division of Real Estate wants to encourage agents to avoid late fees with license renewals. To avoid late fees, make sure your continuing education credit is complete and banked by the education provider by the 15th of the month. Also make sure to complete your renewal on time at https://realestate.utah.gov/realestate/renewal.html
“To renew on time without incurring a late fee, an applicant for renewal shall, by the 15th day of the month of expiration, have completed all continuing education credits required under subsection (2)(b) to ensure continuing education providers have time to bank continuing education hours prior to license expiration,” according to Administrative Rule R162-2f-204(1)(b).
To see other news and information from the Division of Real Estate, follow them on Facebook at https://www.facebook.com/DivisionofRealEstate
