Hello, everyone. Thank you so much for tuning into, “This Needs to Be Said”. Our friend, attorney Peter Daigle is here to talk with us about some very important information as always, but this is critical because we’ve been going through a pandemic the past year. And, you know, the law has allowed for some things to be put on hold and that time is coming to an end. So one of those topics will be for those who have a loan, a mortgage, and that moratorium is getting ready to come to an end. And Peter is getting ready to tell us, how to prepare ourselves or what we should be doing, what we need to know. So welcome back, Peter, how are you?
Oh, thank you Katherine, very nice. Thank you. Thank you for that wonderful introduction. And as always, it’s always a pleasure to talk to you.
Always! So we’re talking today about loan modifications and, you were before we got on air, he gave me a little, little privy, pre-judge to what we’re gonna talk about today. And this is specifically towards people who have a mortgage. These are things to consider and I want y’all to always remember Peter’s the expert, I’m just sharing the information, but your, situation is specific. Don’t take this as your advice. Contact him to for your specific situation. And this is crucial, this information he’s about to share because it happens very soon. So I’m now gonna shut up and get my pen and paper out because I need to learn too.
Thanks. So just by way of a little bit of history, as we all know, back in late February of 2020, when COVID hit that, a lot of people lost their jobs and basically economy would just seized right up. So this was a result of that without the income to Americans, the government stepped in and says, okay, we’re going to put a freeze on foreclosures of homes. And so if you get the, you can become delinquent or in default of your home mortgage, until that the pandemic is under control, we’re not going to foreclose on you. Okay. And so people that lost their jobs, or had small businesses that weren’t able to keep up, did not have to pay their mortgage okay without the threat of a foreclosure. So since February late February, March of 2020, when they first put the moratorium on, it’s been extended a few times.
Okay. But the last engine now was until June 30th, this year, there’s nothing in the news or nothing out there that says it’s going to be extended any more than that because the economy seems to be coming back here. So what does that mean What that means is that if you are delinquent on your mortgage currently, and usually the amount is about three months, once you’ve missed that third payment, then the banks, start, you know, putting in the, in the foreclosure process. So beyond three months, you’re going to want to talk to your lender because let me tell you what I’m hearing out there. So as of June, as of January 30th, the banks have the ability to foreclose if they want but they’re concerned about the amount of real estate that would flood the market if they try to foreclose on everybody.
So what they’re going to be doing is now this is also good news for not just the homeowner, but also the banks is that the appreciation of real estate right now at least in our part of the country is really coming off, went up considerably. And so the banks, if they had a loan that was kind of shaking before, because the amount of money owed was really close to what was worked backwards, where the banks were a little nervous because they didn’t know whether or not they’d ever see their money again, without having a foreclose. But now that the values have come up, okay. And now the banks are a little safer in the amount of equity that they have in a property in the, so not so worried about losing it if they have to foreclose. so in order to not flood the market place, there, the banks are going to offer, offer a couple of options.
One is that, and this is not all banks by the way. Okay. This is banks that are backed by the FHA because of government back loans, which are probably 75 or 80% of all the loans in the country. You’re going to go this way. The other 20% are what I call conventional loans and the loans that are given by your local bank. So if you go into bank of America, let’s say what’s more likely you’re going to have an FHA back loan because those banks, they sell the mortgages, to the government or the government ministers them, where if it’s a little tiny, small and local bank, they might keep it in-house. So don’t take that for sure. But that’s kind of how it works, where loans either held in-house or they’re there, or they’re sold to the government on the FHA program.
Okay. And so, the ones that are on the FHA program, they’re going to be offered a deferral. So what that means basically is that the amount of the, we’re going to call it the arrears. So let’s say to make the numbers work, your mortgage payment is a thousand dollars a month. And youth missed, 14 of them are $14,000 is you’re behind so if you don’t have the $14,000 to bring a current, a deferral takes a $14,000 and basically puts it at the back end of the loan, and you can rest it a principal. So you don’t pay it back that 14,000 back until, you know, the house sells or until your refund is something. So you now become current because the $14,000 is, is now, added to the back end below. Okay. And these are going to be, hopefully you haven’t seen all the guidelines yet, but somewhat simple where you just sign the form and say a, be affected by coal, but then you want to defer the loan interest and hope they’re willing to do it.
Some banks may require some paperwork, but you know. So be aware of that. It’s not set in stone as to how these deferrals are going to work. Okay. But they’re very simple. And if you, if you get off at a deferral, you should take it. Okay and the process for getting deferral, is easy. Okay. the other option that may be offered by some banks that have the, we’ll call them conventional loans, loans that are not sold for the government is they may not do the deferrals, but they may, but they may want to do is what’s called a loan modification, which as you may have heard those terms out there and in doing a loan modification, it’s a little bit more, rigid on terms of the qualifications on that. And they require a certain amount of income, and they look a little closer at your situation on being able to re to, approve it.
So there’s a little more looking under the hood, so to speak versus just, you know, checking the box and signing the name and getting the deferral. So if your bank is not allowing you to do a deferral automatically, they’ll allow you to do a loan modification, which is, it’s a little more involved because as summit bank statements, pay stubs, tax returns, and it’s, it’s quite a bit involved. But, from what I’m told, when hearing anyway, if the banks are going to be, they’re going to try to be cooperative to try to get your loan performing again, because they don’t want all these properties having a full clause, because if they have to foreclose and take it back, let me see, got a mobile on insured, turn the water off, turn the electricity off. It’s just a, it’s a lot of administrative expenses for the bank did refer to let you keep the house as long as the loan performing. Okay, so I know I’ve given you quite a bit of information here this morning, but, but feel free to ask you a questions or if you think I’ve not framed something properly, I’ll try to, I’ll try to rephrase it. Well, never.
I don’t ever think you’re not seeing anything properly. I’m wanting to clarify though cause you said the FHA, is the government back loans and you were telling us, so,
How would I know that I have a government backed loan because some of us have gotten a mortgage and it’s been a while and, and of course, if you hadn’t had to pay attention to it in the past year, maybe I’m the only irresponsible one. And I’ll speak up for someone else who may have this question. Maybe I don’t bank at bank of America. Maybe I have a small, you know, local bank. Is it possible that they wouldn’t have given me a, federally backed loan or
It’s a closing at the closing. You would have had documents for that. So the bank would have declined right off the bat, whether or not they’re going to keep it in house or sell it off. Okay. So that’s something that, you know, you may not know, but you could call them loan, your loan service. Is it a conventional FHA loan so it’s the question. Okay.
Sometimes you have to, sometimes your mortgage company would sell your mortgage to another company I’ve seen that happen. So it could, that could change. Yeah.
Well that could be just the service though. Could you be, just be the service, the service and who holds the debt the whole, if all the debt is the FHA, that’s the government and they hold the debt. If it’s just the bank holding it, then that’s a conventional loan.
Okay. Okay. And, and that’s what I was trying to forget. So what are the pros and cons if I do not have a federal, FHA loan?
What, what’s it like what’s my bank office. Well, they’re going to give you a menu and you got to operate from the menu. You’re not going to be able to create your own situation. So my point of all, this is that if you’re behind on your mortgage, you should talk to your bank or your loan, a bunch of options. They’ll tell you your options. What are my options Okay. But, but right now everybody’s in silent because there’s a moratorium and then nothing’s happening. But after June 30th, if you’re in here equal on your mortgage, you need to call your servicer and then, you know, figure out what your options are. And I’m just possibilities today. Endless, endless, you know, opportunities. But it’s really gonna depend on what the bank says.
Okay. Okay. That’s okay.
I just want to educate folks as to what’s happening here. That’s all.
Yeah. That’s what I was. Yeah. I’m tongue tied this morning. I get my tongue together. Yeah. Okay. So it’s not that someone’s going to be in a worse situation. You’re just saying, Hey, I’m putting you on alert, con contact your servicer. And thank you for clarifying that because me and my friends talk around the water cooler and you just heard what I thought, I knew, Hey, don’t they change your, your mortgage in the middle of sometimes he said, no, your service. Right, so even though that wasn’t the point today, you helped me with that. Again, we, we talk around with our friends. We need to talk with someone who knows what they’re talking about to help point us in the right direction. And sometimes when things are silent, we think nothing’s happening. And this is a great time. This discussion here is a great example of just because it’s quiet, doesn’t mean nothing’s going on. And because this is, almost like here right now, situation, contact your service or you’ll own service provider with your mortgage, contact them as soon as possible. Like as soon, soon, soon, soon before 30th to find out what your options are. And that’s what Peter shared with us today that get it exactly. You got it. All right! I love it.
Well, you’re great at educating us and I look forward to it each time there’s no way I could know all of this stuff with understanding, knowing it all. So thank you so much. How do people get in touch with you outside of, this needs to be said.
Okay. So my name is Peter Daigle and my phone number is (508) 771-7444. And my website is Daigle law.com Daigle office.com. And you can just Google me and find me, and then I’ll be happy to send you a copy of my book and set up a consultation, or whatever, but we’ll, you’ll, you’ll find me and I’ll find you
Absolutely until next time you have a super day. Thank you.
Okay, Katherine. Thank you. Bye bye now.