Homeowners and renters in Connecticut will be getting some relief during the COVID-19 pandemic.
Over 60 financial institutions have reached an agreement with the state to offer mortgage payment relief for residents and businesses in Connecticut who are impacted by the coronavirus crisis, Gov. Ned Lamont announced Tuesday.
Homeowners will now be able to receive up to 90 days of a grace period on their mortgage payments, according to the governor.
Financial institutions will also provide relief from fees and charges for 90 days, including mortgage-related late fees and other fees including early CD withdrawls.
The governor reported there will be no new foreclosures or evictions for 60 days.
In addition, consumers will not have their credit score impacted by coronavirus-related late or missed payments.
Some of the banks and financial institutions participating include: Webster Bank, American Eagle Financial Credit Union, Liberty Bank, Charter Oak Federal Credit Union, Bank of America, Nutmeg State Financial Credit Union and Peoples United Bank.
More banks are expected to join the effort in the coming days, said Jorge Perez, the commissioner of the Department of Banking.
“This is a time when we need our entire financial services industry to come together to work tirelessly for the people of Connecticut, which is why I have asked the banks and credit unions to join forces and present one united approach which tells all of Connecticut, ‘We are in this together,’” Commissioner Perez said. “I am pleased to see that these efforts are well underway and that they are helping Connecticut residents work through this challenge.”
If you need to speak with your financial institution about participating in this relief program, Perez urges you to give the bank a couple of days before contacting them since this agreement was just recently reached and is currently being enacted.
The state provided the below Frequently Asked Questions answers:
Questions and Answers on Connecticut’s COVID-19 Mortgage Relief Agreement
How do I get mortgage relief and/or forbearance?
· You should contact and work directly with your mortgage servicer to learn about and apply for available relief. Please note that financial institutions and their servicers are experiencing high volumes of inquiries.
How long will the forbearance last?
· Participating financial institutions are now offering mortgage-payment forbearances of up to 90 days, which will allow homeowners to reduce or delay monthly mortgage payments.
What effect will this have on my credit report?
· Financial institutions will not report derogatory information (e.g., late payments) to credit reporting agencies but may report a forbearance, which typically does not alone negatively affect a credit score.
How long will these programs last?
· It is still unclear how severe or how long the COVID-19 impacts will be. Financial institutions have committed to necessary relief and will be assessing the ongoing conditions and necessity of continuing relief.
What if my financial institution isn’t offering this relief?
· At this time, Webster Bank, American Eagle Financial Credit Union, Liberty Bank, Charter Oak Federal Credit Union, Bank of America, Nutmeg State Financial Credit Union, and Peoples United Bank, in addition to over 50 other federal and state-chartered banks, credit unions, and servicers are supporting these commitments. The state will welcome any other institution that would like to meet the moment and provide much-needed financial relief to Connecticut residents. The Department of Banking will publish a list of participating financial institutions on its website in the coming days.
What if I already made a payment or was hit with a fee because of COVID-19?
· These measures go into effect as of March 31, 2020.
Is the mortgage relief available to businesses?
· The relief is currently only available for residential mortgages.
What if my mortgage servicer is not communicative or cooperative?
· You can file a complaint with the Department of Banking through the complaint form on the department website or by contacting the department at 860-240-8299 or 1-800-831-7225 (9:00 am to 5:00 pm EST Monday through Friday).
What impact does the CARES Act have?
· The CARES Act has important protections for renters and homeowners. In particular, homeowners with mortgage loans that are backed by the federal government through the FHA, Freddie Mac, Fannie Mae, or other agencies can receive significant forbearance.