Vancouver, Canada, March 25, 2020 --(PR.com
)-- Despite the hope offered by the deferral relief announcements, homeowners and landlords are now realizing that the mortgage deferral plan isn’t a government grant, but a lender decision.
That means not all property owners struggling to make a mortgage payment (or pay bills) will be approved for a mortgage deferral. It also means landlords may not be capable of passing on rent relief to their tenants.
To qualify for the relief, borrowers need to show evidence of unemployment, diminished assets, lack of savings and other financial hardships that would make it difficult or impossible to make a near-term mortgage payment.
Many property owners and small landlords will be scrambling to make their April 2020 mortgage payments. But there are options. As a leading real estate online marketplace, with over nine million people starting their property search on Zolo.ca each month, here are 8 tips:
#1: Use your mortgage "skip-a-payment" option
#2: Know that the "skip-a-payment" option does not hurt your credit score (but missing a payment or making a late payment can).
#3: Don’t liquidate your RRSPs to pay your mortgage (or other debts)
#4: Ignore bad financial advice (such as taking out a loan, at this point in time, in order to invest)
#5: Use your credit options (such as HELOCs and low-interest credit cards)
#6: Apply now for a low-interest loan (just don’t expect to get approved quickly, or if you’re debt ratios are high)
#7: If you’re a landlord, know that banks and mortgage lenders won’t let you defer a mortgage unless it’s on your principal residence.
#8: Be proactive (call your lender to discuss increasing your amortization, applying credit from past pre-payments, deferring payments or other lender-specific solutions).
While every financial situation is different, the key to tackling the COVID-19 outbreak impact on your monthly budget and mortgage debt is to get educated and be proactive. Remember to keep paying your bills on time, even if it's only making the minimum payment. Missing or late payments will be reported on your credit report, which could lower your credit score and make it harder for you to obtain credit now and in the future.
To learn more about these tips, go to https://www.zolo.ca/news/covid-19-estate-planning-guide
Zolo is one of Canada's most popular online national real estate marketplaces. Each month, more than 9 million buyers and sellers start their real estate search using Zolo. As a tech-disruptor national brokerage, Zolo provides users the data and resources needed to make better-informed property decisions.
Romana King is an award-winning personal finance writer and real estate expert. She writes for big banks, insurance providers, newspapers along with businesses. She is an expert that is sought after by media to comment and give insight on personal finance and real estate issues.
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Director of Content at Zolo and award-winning personal finance writer