Mortgage interest rates are down again. They are lower than they were a year ago and up slightly from the all-time low earlier this year.
To get a better view here is a chart that goes back to 2018
The low-interest rates do make buying a home more affordable. Don’t panic when they go back up to 3% because they will.
Some folks made it through the pandemic with the same job or a better job and with bigger savings accounts due to less
spending during the various lockdowns.
There is help for people who are struggling to pay their mortgage. Here is information on the Consumer Financial Protection Bureau website.
Rental assistance is also coming soon through Minnesota Housing, check the website for details.
The last year has been very unkind to women and to hourly wage workers when it comes to job loss.
If you are struggling to pay rent or make mortgage payments please be proactive. Forbearance programs are fairly painless. The period of the mortgage is extended and missed payments are tacked onto the end.
As a general resource, I always recommend the Minnesota Home Ownership Center for home buyers and homeowners. They offer a variety of programs including counseling and foreclosure prevention.
In other news CARES Act Foreclosure Moratorium – (applies to FHA, VA, USDA, Fannie Mae and Freddie Mac backed mortgages – about 70 percent of homeowners) has been extended to June 30, 2021
The CDC Eviction Moratorium – Expires March 31 (applies to renters)
Find updates on the Minnesota Home Ownership Center website under “news”.
Mortgage interest rates are oh so low. Some homeowners have managed to refinance. Refinancing can mean lower monthly payments. For those who are facing unemployment now may be the best time to refinance.
Lower interest rates will provide a little relief for homebuyers who will be experiencing high prices and a strong seller’s market in 2021.
The rates in the chart are averages from FreddieMac and are available to people who have great credit scores and incomes that afford mortgage payments.
At one point I said that mortgage interest rates would not go below 3%. I am very happy to be wrong about this.
During the great recession, we had foreclosures and short sales. As I recall there were loan modification programs for borrowers but the rules kept changing about who was eligible and who was not. Sometimes people who were behind on mortgage payments were eligible and sometimes they were not.
During the current crisis and it is a crisis there are forbearance programs and various laws that prevent foreclosure. Forbearance programs allow borrowers to skip payments. The payments are added to the end of the loan repayment period.
There is help for those who are struggling to make mortgage payments. The Minnesota Homeownership Center is a great place to start. They are a non-profit and provide free counseling and are generally knowledgeable about every program out there that can help homeowners.
As always be aware of scams. I am not aware of the latest but I know there are always people out there ready to trick people out of their homes and life savings. If a program sounds too good to be true the Minnesota Homeownership Center can help with that and the Minnesota Attorney General’s website has some useful information on it about scams.
Don’t be afraid to talk directly to your lender if that is possible. If you have n FHA loan there may be federal assistance. Serious mortgage delinquencies are up from a year ago. the last number I saw was at around 7% as compared with less than 4% last year.
This year has been the year for new lows as mortgage interest rates hit new lows for the 10th time. I told a client earlier this year that I didn’t think rates would go below 3%. I am happy to be wrong.
Speaking of records, 2020 has been breaking a lot of long-standing records. Did you know that we hit an all-time high in unemployment in 2020? 14.70 percent in April of 2020.
The Minnesota Homeownership Center and Habitat for Humanity of Minnesota have entered into a partnership aimed at helping homeowners facing financial difficulties due to COVID-19 to keep their mortgages in good standing and avoid foreclosure.
The two organizations will administer up to $10 million in relief through Minnesota’s newly established COVID-19 Housing Assistance Program (CHAP)
To qualify for assistance, Minnesota households must meet all of the following criteria:
The program covers past-due housing expenses such as:
For more details go to the Minnesota Home Ownership Center
I’ll never forget the great housing crash of a decade ago where banks foreclosed and then turned around and sold the houses at much lower prices making the houses affordable for new owners.
The banks made it through the foreclosure crisis and remained profitable while some homeowners never recovered.