Your credit plays a key role in financial opportunities, today and in the future. Understandably, the current pandemic environment is making it more challenging. But still, there are actions you can take to protect your credit.
Here are tips that the Consumer Financial Protection Bureau suggested for protecting your credit during these trying times.
Did you know that you're entitled to a free credit report every year? Unlike the hard credit inquiries that creditors do when you apply for credit, this free annual report does not negatively affect your score.
Additionally, Equifax, TransUnion, and Experian (the three nationwide credit reporting agencies), also provide you with a free credit report every twelve months.
Reviewing your credit report is especially helpful for finding errors that are lowering your score. If your report is inaccurate, contact the credit reporting company to dispute the mistake and request it's removal. Depending on what the error is, your score can go up significantly.
We shared different ways that you can manage your mortgage payments during the shelter-at-home order in previous posts. But the number one takeaway is that you should never abruptly stop making mortgage payments. Missed or late payments will be reported to the bureau by the lender.
If your ability to make mortgage payments is hindered due to Coronavirus, your next move is to talk to your current lender. If your mortgage is government-backed, then there is existing legislation that can put your loan in forbearance.
Additionally, your current lender may also have a loan modification option that can provide temporary relief.
For a long-term solution, the best option is to refinance your current mortgage. Rates are currently at record lows, and refinancing could lower your monthly payment.
Even those that can keep up with their monthly mortgage payment are still choosing to refinance. Current homeowners are choosing to refi to reduce their monthly payment or pay down the principal faster or to do both!
Credit Reporting under the CARES Act
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is legislation that temporarily alters the way your loan payments are reported to credit bureaus. Under this current legislation, creditors agree to "accommodate" you when it comes to reporting deferred payments, partial payments, forbearance, mortgage modifications, or other types of payment relief.
Note that this only applies if you're affected by the coronavirus pandemic, entering an agreement with the creditor and whether you were already delinquent before the CARES Act was initiated.
Here are typical scenarios:
Note that these reporting modifications apply only to agreements made between January 31, 2020, and 120 days after the COVID-19 national emergency ends.
Again, the BIG takeaway is that you must be proactive and talk to your creditors to see what your options are --and NEVER stop making payments abruptly.
Your financial health is essential during this pandemic, and, as always, we're looking out for your best interest. Need more personalized mortgage guidance? Please contact us! We're available and fully operational, eager to help you secure your financial future.
We've been helping customers afford the home of their dreams for many years and we love what we do.
Company NMLS: 1805375
12960 SW 133 COURT
MIAMI, FL 33186
REEL MORTGAGE SOLUTIONS, LLC strives to ensure that its services are accessible to people with disabilities. REEL MORTGAGE SOLUTIONS, LLC has invested a significant amount of resources to help ensure that its website is made easier to use and more accessible for people with disabilities, with the strong belief that every person has the right to live with dignity, equality, comfort and independence.
REEL MORTGAGE SOLUTIONS, LLC makes available the UserWay Website Accessibility Widget that is powered by a dedicated accessibility server. The software allows reelms.com to improve its compliance with the Web Content Accessibility Guidelines (WCAG 2.1).
The REEL MORTGAGE SOLUTIONS, LLC accessibility menu can be enabled by clicking the accessibility menu icon that appears on the corner on the page. After triggering the accessibility menu, please wait a moment for the accessibility menu to load in its entirety.
REEL MORTGAGE SOLUTIONS, LLC continues its efforts to constantly improve the accessibility of its site and services in the belief that it is our collective moral obligation to allow seamless, accessible and unhindered use also for those of us with disabilities.
Despite our efforts to make all pages and content on REEL MORTGAGE SOLUTIONS, LLC website fully accessible, some content may not have yet been fully adapted to the strictest accessibility standards. This may be a result of not having found or identified the most appropriate technological solution.
If you are experiencing difficulty with any content on REEL MORTGAGE SOLUTIONS, LLC website or require assistance with any part of our site, please contact us during normal business hours as detailed below and we will be happy to assist.
If you wish to report an accessibility issue, have any questions or need assistance, please contact us by sending an email to: firstname.lastname@example.org