Wells Fargo Mortgage Help – Forbearance With End of Loan Payment Deferral

COVID mortgage forbearance Wells Fargo

Some mortgage forbearance stories have a good ending. Wells Fargo, for example, is quick to respond and help borrowers who have trouble paying their mortgage due to Covid-19. In fact, they have one of the most comprehensive websites explaining the types of mortgage assistance they offer. Upon request, they will suspend your mortgage payments for three months, and potentially extend the suspension for three more months. During this time, they will not report the missed payments to credit bureaus, unless you were previously in default.

The terms of repayment of your Wells Fargo mortgage can range from the several options, aligning with the CARES Act, depending your loan type and investor.   Some examples of loan backers, or investors, are government sponsored enterprises (GSE’s) like Fannie Mae, Freddie Mac, VA -Veterans Administration, USDA and HUD.  Here are the options Wells Fargo lists as possible solutions after the forbearance period ends:

  1. Lump Sum Payment (if you can) to repay the missed payments at once.
  2. Repayment Plan spreading out the missed payments over a few months, as agreed. For example, if you were $4000 behind, instead of paying $1500 per month for your regular mortgage payment, you could pay $400 more, or $1900 per month, for ten months, until the suspended amount of $4000 is re-paid.
  3. Loan Modification refinancing the whole mortgage balance to add in the missed payments. For example, if you owe $100,000 and skip $6000 in payments, your new loan would be for $106,000 and perhaps your interest rate would be changed.
  4. Mortgage Deferral There are two possibilities with deferral (or deferment). The first option, for example, would be if you skipped three months of payments, your loan term would be extended for three months. So, instead of having 30 months left on your mortgage, you would have 33 months. The second option would be to have the full amount of your skipped payments payble as a lump sum at the end of your loan or when you sell the house.   So, if you skipped $5000 in payments, when you finally pay off your house or sell it, your last payment or payoff amount, would be $5000 higher. Here is a Wells Fargo deferral letter that illustrates the latter:

    Wells Fargo Forebearance Le… by Wendy Rulnick on Scribd

    If you find that you need to sell your Emerald Coast real estate, contact me to discuss your options, whether traditional sale or short sale.

    It’s Wendy… It’s Sold!

    Wendy Rulnick, Broker, Rulnick Realty, Inc.
    Call 850-259-0422
    Email Wendy: itswendy@rulnickrealty.com

    Wendy Rulnick, Broker, sells short sale, pre-foreclosure, REO and traditional real estate in Destin, Santa Rosa Beach, 30A, Miramar Beach, Crestview, Sandestin, Seaside, Rosemary Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Florida.

    This site, Wendy Rulnick or Rulnick Realty, Inc. is not providing legal or tax advice. The information provided is for educational and informational purposes only. It is recommended that sellers considering a short sale should consult an independent legal and tax advisor for more information.

Don’t Let Your VA Mortgage Lender Scare You About Lump Sum Payment

You lost your job.  You are a Veteran. You cannot make your mortgage payments. You called your lender and their steely “debt collector” tone and threatening letter would scare anyone.

If you experienced loss of income on the Emerald Coast of Florida due to the COVID-19 crisis, the Veteran’s Administration has issued clarifications about how your VA mortgage lender must treat you.  Initially, VA borrowers may have received intimidating letters, such as this:

In fact, this forbearance letter refers to foreclosure twice, as well as short sale, and credit implications. It implies that to catch up, the loan must be brought “current” through a reinstatement (e.g. lump sum payment), or another workout option. This is pretty scary stuff.  The VA, however, has issued Frequently Asked Questions  that should put you at ease regarding your VA mortgage and keeping your home, as specified in the Coronavirus Aid, Relief, and Economic Security – CARES Act:

  1. You may skip payments for 180 days and extend to 360 total days should you be economically impacted by Covid-19.
  2. Your credit score will not be changed to “delinquent” during this time (unless you were previously in default).
  3. You will not have to pay a late penalty, however, interest will accrue.
  4. You do not have to make a lump sum payment at the end of your forbearance payment (however, you can if you want to).
  5. Your VA mortgage lender may offer to modify your loan to extend the term, adding the missed payment months to the end or your loan (a type of deferment).
  6. Your VA mortgage lender may offer to make the missed payments payable in one amount at the end of your mortgage term.  For example, if you missed $10,000 of payments, when you sell your house, the $10,000 amount would be added to your mortgage payoff.
  7. You could spread out the missed payments over time with an agreement from your lender.
  8. If you don’t recover financially at the end of the help period, you may do a VA Compromise short sale, a regular sale, or a deed-in-lieu of foreclosure.

Bottom line, if you contact your VA mortgage lender for help now during the Covid-19 crisis, they should respect you and your  military service, and work with you, not force you to make a lump sum repayment.

If you decide to sell your Emerald Coast of Florida home, contact me to explore your options, whether by traditional sale or VA Compromise short sale.

Wendy Rulnick,
Broker, Rulnick Realty, Inc.
Call 850-259-0422
Email Wendy: itswendy@rulnickrealty.com

Wendy Rulnick, Broker, sells short sale, pre-foreclosure, REO and traditional real estate in Destin, Santa Rosa Beach, 30A, Miramar Beach, Crestview, Sandestin, Seaside, Rosemary Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Florida.

This site, Wendy Rulnick or Rulnick Realty, Inc. is not providing legal or tax advice. The information provided is for educational and informational purposes only. It is recommended that sellers considering a short sale should consult an independent legal and tax advisor for more information.

Predictions for the Destin – Emerald Coast of Florida Housing Market – April 2020

What are the predictions for the Destin, Emerald Coast of Florida real estate market? How is the COVID-19 crisis going to affect home sales in the coming months? This I was asked by one of my good clients. Here is what I told him.

February and March home sales were strong, and better than a year ago. However, a major change took place in the Destin-Niceville market after April 1.  That’s when the Florida stay-at-home order was implemented in response to the novel Coronavirus.  All, but essential services, were allowed to stay open in Florida. Home showings decreased on many listings.

Comments from Realtors who lost sales, cited these reasons:

  1. Cash buyers lost money in the stock market.
  2. Commercial buyers were afraid to invest in a new business.
  3. Equity line buyers had their equity lines frozen.
  4. Eglin AFB and Hurlburt PCS orders were put on hold.
  5. Sellers withdrew listings.

Other observations that may affect the housing market are:

There will be a slowdown in mortgage lending, because big banks are increasing credit score requirements and down payment percentages (700 minimum credit score and 20% down). They have lost liquidity from the many forbearance requests from their current borrowers, but they still have to pay their investors. That will make properties harder to sell, as the buyer pool will be reduced.

Builder confidence is at the lowest level in nine years, per the National Association of Home Builders.

Institutional iBuyer companies who buy homes from individual owners are scaling back or stopping completely to preserve capital.

Fannie Mae predicts U.S. home sales will fall by 15% this year.  They also predict that median house prices will go up slightly.  This could be because inventory levels will decrease.

The SBA Economic Injury Disaster Loan program was changed to reduce grant monies to companies, now capping at $1,000 per employee, up to $10,000, not a full $10,000, as previously stated. This is a blow to companies and their employees.

2.9 million mortgages are in forbearance.

24% of small businesses may close permanently.

Then, there’s unemployment. It’s at the highest level since the Great Depression.

The Emerald Coast is diverse enough to attract multi-million dollar purchasers to Destin and 30-A, and a steady flow of military servicemen and women to Navarre, Fort Walton Beach and Niceville.  The luxury buyer and seller, and Eglin Air Force Base and Hurlburt Field buyers and sellers should be able to prop up their market segments.  And despite national statistics, some local builders are doing well and custom building should continue.

However, small business owners and others whose income has been reduced or eliminated, would cause a slowdown of sales and downward pressure on pricing. Real estate sales on the Florida Panhandle are down by 45%. The next few months will shed more light on how the Emerald Coast will recover.

Wendy Rulnick, Broker
Rulnick Realty, Inc.

direct: 850-259-0422 email: itswendy@rulnickrealty.com

If you are considering selling now or after the COVID-19 crisis, contact me to explore how, whether by traditional or short sale.

Bank of America Offers Mortgage Forbearance – Not Deferral

If Bank of America is your mortgage servicer and your ability to make your Destin, Florida mortgage payments has been affected by the COVID-19 crisis, be careful asking them for assistance.  Bank of America, one of the biggest U.S. mortgage servicers, recently changed their home borrower website to reflect choices of either mortgage forbearance or mortgage deferral for those who are struggling and want to avoid foreclosure.  A week ago, Bank of America only offered forbearance on their website. Most people don’t know the difference. Mortgage forbearance is a delaying of payments due. This may be for a period of three months, six months, or even longer.  At the end of the forbearance period, you may have to pay back all your missed payments at once in a lump sum.  (Yikes!)

Mortgage deferment, or deferral, on the other hand, would allow you to add the skipped payments to the end of the loan by extending the loan term, or obtaining a second mortgage that would not be payable until the first mortgage is paid off e.g. when you sell the house. (As of April 1, FHA or HUD backed mortgages will allow mortgage deferment during the Coronavirus crisis). Mortgage deferment is more palatable to many people, because who would suddenly have enough money for three to six months of payments, if they had asked to skip them in the first place?

Take note, however, you won’t automatically get a deferment even if you check the right box on the Bank of America website. They will tell you that if you have a Fannie Mae or certain other government-backed loan, they cannot offer you a deferment. If you choose forbearance, in that case, you may have an option of spreading out the missed payments to re-pay them after the forbearance period ends, modifying your entire mortgage to include those payments, or paying the full amount in a lump sum, as specified in the CARES Act.

After you request mortgage assistance online, Bank of America will send you a follow-up email and mail you one or two letters.  The first, a forbearance letter, and the second, a letter offering you a dedicated mortgage specialist to discuss your situation.  (Obviously, they have not refined their system yet.) If you are not sure how to proceed, keep following up with them, as the mortgage assistance programs are changing regularly.

Here is a copy of a Bank of America forbearance letter.

If you find that during or after the COVID-19 crisis, you must sell your Emerald Coast real estate, consider your options. Contact me to explore whether it’s realistic and how you may accomplish it, whether by short sale or traditional sale.

It’s Wendy… It’s Sold!

Wendy Rulnick, Broker, Rulnick Realty, Inc.
Call 850-259-0422
Email Wendy: itswendy@rulnickrealty.com

Wendy Rulnick, Broker, sells traditional and short sale real estate in Destin, Santa Rosa Beach, 30A, Miramar Beach, Crestview, Sandestin, Seaside, Rosemary Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Florida.

Foreclosures Postponed in Florida for 45 Days – Destin FL

If you are having trouble paying your mortgage and are facing foreclosure in the Destin, Niceville and Fort Walton Beach areas, relief is available. There is now a moratorium on Florida foreclosures from April 2 through May 17, 2020, per order of Governor Ron DeSantis. Executive order 20-94 states that the COVID-19 emergency has impacted people’s ability to make single family residential mortgage payments. The order suspends “any statute providing for a mortgage foreclosure cause of action” under Florida law and hints at an extension of the moratorium beyond the 45 days. This does not mean you are relieved of your mortgage debt, past due monies owed, nor future loss mitigation and foreclosure.

The new Florida foreclosure order mimics the foreclosure hold specified in the federal CARES Relief Act, but goes beyond it. The CARES Act only places a moratorium on federally backed mortgages, including Fannie Mae, Freddie Mac, FHA, VA, USDA and HUD.  The Florida foreclosure moratorium suspends foreclosures for any type of mortgage.

If you are experiencing difficulty making your mortgage payments, reach out to your lender or mortgage servicer for assistance. You may be eligible for forbearance of your payments for 90 or 180 days, or more. Be careful when requesting forbearance, as compared to mortgage deferment. With forbearance, your skipped payments may be due all at once at the end of the forbearance period. For example, if you are allowed to skip $6000 of mortgage payments for three months, at the end of three months, you would pay the $6000 back at once. Alternatively, your lender may offer you a loan modification at the end of the forbearance period, or offer to spread out the missed payments over several months.  Or, they may offer you reduced mortgage payments for 90 days or more. You would pay it back over a specified amount of months. A mortgage deferral, however, would allow you to add your missed payments to the end of the mortgage term.  Obtain clarity from your lender as to exactly what they are offering. Consider consulting with an attorney for further guidance.

Finally, you may be able to avoid foreclosure by short sale. If you are contemplating selling your Emerald Coast real estate, contact me to discuss how.

It’s Wendy… It’s Sold!

Wendy Rulnick, Broker, Rulnick Realty, Inc.
Call 850-259-0422
Email Wendy: itswendy@rulnickrealty.com

Wendy Rulnick, Broker, sells traditional and short sale real estate in Destin, Santa Rosa Beach, 30A, Miramar Beach, Crestview, Sandestin, Seaside,  Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Florida.

This site, Wendy Rulnick or Rulnick Realty, Inc. is not providing legal or tax advice. The information provided is for educational and informational purposes only. It is recommended that sellers considering a short sale should consult an independent legal and tax advisor for more information.

Elliotts Point VA Compromise Short Sale Approved – 118 Ferry Rd., Fort Walton Beach Florida

This Elliotts Point home at 118 Ferry Rd., NE, Fort Walton Beach, Florida was approved as a VA Compromise Short Sale. This was not an easy property to sell, even though the short sale approval was easy! The home had multiple active roof leaks and and the roof was covered with tarp and sand bags. The roof design was itself defective. There was aluminum and cloth-covered wiring.  The costs to repair the roof and electrical system were about $16,000.  The home needed other repairs. The only straightforward way to ensure a buyer could close after short sale approval, was to get a cash buyer.  Sure, there are mortgages available for homes that need repair, such as FHA 203K, but they are complex and closing is not guaranteed, especially with a fast time line and closing requirement after short sale approval that is typically 30 days. Since we limited the market for the Fort Walton Beach short sale home to only cash buyers we shrunk the pool of interested parties. Two buyers walked due to their home inspections and one buyer simply “defaulted” and failed to close after short sale approval.  The fourth buyer closed. It takes perseverance to accomplish a successful short sale.

Many current and former Eglin Air Force Base, Hurlburt Field, Duke Field, Whiting Field military personnel have used the VA Compromise Sale as a benefit when hardship hits and they are unable to pay their mortgages.  It is an honor to help those current and former military service members who may need to sell their Emerald Coast area property to avoid foreclosure.

Here are the details of the VA Compromise Sale of 118 Ferry Rd. NE, Fort Walton Beach, Florida:

Lienholder: Shellpoint Mortgage Servicing

Mortgage Balance: $185,000 approximately

Appr Sale Price: $155,900,000

Short Sale Appraised Value:  $165,000

Seller Cash Contribution: -0-

Seller Promissory Note: -0-

Waiver of Deficiency: Yes

BONUS TO SELLER: Since this was a VA Compromise Sale, the seller was eligible to receive $1500 as a VA relocation benefit.
Note: If your agent does not ask for this incentive – you are not going to receive it. I asked.

It’s Wendy… It’s Sold!

Wendy Rulnick, Broker, Rulnick Realty, Inc.
Call 850-259-0422
Email Wendy: itswendy@rulnickrealty.com

www.shortsales-emeraldcoast.com

Wendy Rulnick, Broker, sells real estate in Destin, Santa Rosa Beach, 30A, Miramar Beach, Seagrove Beach, Watercolor, Sandestin, Seaside, Rosemary Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Florida.

Poinciana Place Condo, Miramar Beach FL – Short Sale Approved in 3 Weeks

This Miramar Beach Florida condo at Poinciana Place was approved as a short sale in three weeks!  Taking only 55 days to go under contract, this Miramar Beach condomium at 320 Scenic Gulf Drive had two liens.  What does that mean? There were two mortgages in this case, each with SPS – Select Portfolio Servicing.  The property was an investment condo, not a primary residence. The borrower was on time with his payments, but needed to sell for individual circumstances.  Some common reasons for short sale include job loss, divorce, death of borrower, medical expenses, relocation and interest rate adjustment increasing the mortgage payment amount, rendering it unaffordable.  This particular short sale had a senior mortgage lien at SPS with just enough proceeds to pay it in full, leaving a portion of the proceeds to pay a lesser amount to the second mortgage. In a short sale, there are not enough proceeds after sale to pay all liens in full.

If you are in a situation where you may need to sell to avoid foreclosure, short sale is an option. Consult with your attorney if you are behind in your mortgage payments and reach out to your lender. If you decide to use short sale to dispose of your real estate on the Emerald Coast, give me a call. I’ll be happy to discuss the ins and outs of the process with you.  I’ve helped hundreds of Emerald Coast homeowners avoid foreclosure through short sale in the following geographic areas: Miramar Beach, Destin, Santa Rosa Beach, 30A, Crestview, Niceville, Fort Walton Beach, Mary Esther, Navarre, Gulf Breeze, Milton, Freeport, Panama City Beach, Pensacola and more.  I may be able to help you, too.

It’s Wendy… It’s Sold!

Wendy Rulnick, Broker, Rulnick Realty, Inc.
Call 850-650-7883 ext 204
Email Wendy: itswendy@rulnickrealty.com

www.shortsales-emeraldcoast.com

Wendy Rulnick, Broker, sells real estate in Destin, Santa Rosa Beach, 30A, Miramar Beach, Seagrove Beach, Watercolor, Sandestin, Seaside, Rosemary Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Florida.