Hurricane Irma may be mostly behind us, but many are still feeling the effects of the storm. As the most recent storm demonstrated, hurricanes can disrupt the lives of those impacted by them for long after the winds have cleared. Whether due to homes requiring repair, power outages, or essential businesses being closed, it can days, weeks or even months for life to return “to normal.” Understandably, this can pose difficulties for those who are struggling to keep up with mortgage payments, especially since these inconveniences often come with a price tag. Luckily, there are protections afforded to debtors following natural disasters that may help them avoid foreclosure.
A South Florida foreclosure defense attorney can better explain which protections apply to your situation. The foreclosure defense attorneys on our team have detailed a few safeguards major loan servicer have in place.
Fannie Mae & Freddie Mac Hurricane Policies
If your home or your livelihood is severely impacted by a hurricane, Fannie Mae will reference your prior mortgage status to determine whether or not you are granted forgiveness for any missed payments following the storm. If you were either current on payments or less than 90 days behind, foreclosure action will usually be blocked for 90 days following the storm. The servicer encourages lenders to develop a plan for getting you back on track during this time. However, if you were more than 90 days delinquent before the hurricane, foreclosure action will likely be permitted as long as you were not in the process of securing an alternative option already, such as a loan modification.
Freddie Mac also extends a 90-day grace period to borrowers in most instances, though there are some differences from Fannie Mae’s approach. The impact you suffered will ultimately determine if you are protected from foreclosure action under Freddie Mac. If it is deemed that your income or housing situation was not significantly affected, the lender may use his or her discretion for awarding protection. That said, if you were extremely impacted, you may be afforded additional safeguards following the 90-day period.
Determining Next Steps
Ultimately, the protections afforded will depend on your particular situation. A South Florida foreclosure defense attorney can help you plot a course of action for moving forward and explain to you the particular guidelines set forth by your lender. Even if your bank has not expressed an intent to offer a grace period following a serious storm, your attorney may be able to negotiate a favorable agreement on your behalf. Additionally, your lender may offer unique protections following the hurricane. For instance, after Hurricane Irma HUD initiated a 90-day moratorium on foreclosures, while JPMorgan Chase waived late fees for mortgages, as well as credit cards and other loans. If you are not offered any assistance from your lender, your attorney can help you explore other foreclosure defenses.
If you were impacted by Hurricane Irma and are now facing foreclosure as a result, our team is here to help. Contact our office today to schedule your free consultation, where we can begin the process of getting your financial life back on track.