04 May What Are Your Mortgage Payment Options During Covid-19?

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Canadians who have lost work due to the COVID-19 health crisis are facing uncertainty over their finances and wondering how they will pay their bills. Fortunately, there is relief for homeowners. Lenders big and small are offering flexible solutions on a case-by-
case basis for homeowners who are struggling with the financial impact of the pandemic. Here are some of the options you may want to explore.

Defer your payments

Before you miss your next payment, call your bank or mortgage broker and find out what deferral options are available to you (be prepared for long wait times on the phone). Some lenders are offering six-month deferrals, but not all requests are granted depending on the situation. If you are granted a deferral, remember that you will be required 

Skip a payment

Review the specifics of your mortgage to see what built-in features are already available. For instance, you may be allowed to skip your mortgage payments for one month, as long as you are in good standing and have not skipped any payments in the past year.

Access your home equity line of credit (HELOC)

If you have one set up, you can access your home equity line of credit (HELOC) to cover your mortgage payments. HELOCs typically come with favourable interest rates and flexible payment schedules. If you don’t have a HELOC and would like to set one
up, be prepared to wait as it could take several weeks.

Stretch out your amortization period

Even though this will mean paying off your mortgage over a longer period, extending your amortization could offer much-needed relief by reducing your monthly payments and freeing up funds for other expenses such as groceries, utilities, and credit card bills.

This information should not be relied on as legal advice, financial advice or a definitive statement of the law in any jurisdiction. For such advice, please consult your own legal counsel or financial representative.

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