Get help understanding what happens after mortgage payment suspension

We understand that COVID-19 continues to cause unpredictable hardships. And while we know you want to get back on your feet as quickly as possible, we realize you may not yet be able to repay your suspended mortgage payments in a lump sum or as part of a repayment plan that increases your monthly payments for a period of time.

Deciding to resume making payments, if you can, is a good choice because it:

  • Provides you with the opportunity to apply for new credit or to refinance.
  • Reduces the chance that your escrow account, if you have one, will have a shortage. If you miss payments, your escrow account may not have enough to cover your tax and insurance bills. We’ll continue to pay them, but this could increase your future monthly payments.
  • Reduces the number of suspended payments that you’ll need to repay.

We can help discuss programs that consider your financial situation, including your loan status, type of loan, and whether your payments were current when the COVID-19 emergency was declared in March.

When you are ready to resume making payments or need to extend relief, you need to request this assistance for each account separately.  For home equity accounts, you will need to call us to resume making payments or to request additional assistance.

Watch this video: Our Community Outreach Consultants can help you understand your options, and why you must contact us with your next steps.

Described below are the basic programs for federally backed loans. The agencies investing in these loans are the Federal Housing Administration (FHA), Veterans Affairs (VA), Fannie Mae (FNMA), Freddie Mac (FHLMC), and U.S. Department of Agriculture (USDA).

Additionally, programs are available for customers with Wells Fargo or other investors not noted above.

 

Programs to help you make up missed payments

 

Homeowners who were up to date on their mortgage payments as of March 1, 2020, (or less than 31 days past due), with mortgages owned or guaranteed by Fannie Mae or Freddie Mac, are not required to repay missed payments all at once.

Programs may include:

  • A repayment plan where the amount due from the missed payments is divided into manageable amounts and spread out over time. This would increase your regular mortgage payments for a while, but would bring the mortgage up to date.
  • Payment deferral where the amount of missed payments is added to the end of your loan term. These missed payments would be due all at once when you pay off your mortgage, refinance, or no longer own the home.
    Please note: You can defer your payments with the COVID-19 Payment Deferral program only once. If you need help with missed payments in the future, we may have other solutions for you.
  • A loan modification where certain terms of your loan are changed — such as the interest rate or the time allowed for repayment — to make payments more manageable. This program is intended for people experiencing long-term financial hardships.

Homeowners who were up to date on their mortgage payments as of March 1, 2020, with mortgages owned or guaranteed by FHA, are not required to repay missed payments all at once.

Programs may include:

  • A separate, interest-free FHA loan where you make your regular mortgage payment and the amount owed is moved to a second, interest-free loan that is repaid when your home is sold or refinanced, or the mortgage is paid off. This loan is an FHA COVID-19 National Emergency Partial Claim.
    • This program would:
      • Bring your mortgage current.
      • Keep the terms of your mortgage unchanged.
      • Maintain your current interest rate and the due date of your final loan payment.
      • Create a separate, interest-free loan, secured by your property. It won’t be due until you pay off your mortgage, refinance, or no longer own the home.
      • Require you to sign final loan documents, but you won’t need to submit any new application documents to qualify.
    • Please note:
      • Your home must be your primary residence.
      • If you’ve had this type of FHA assistance before, you may not qualify for this solution. You can defer your payments with the FHA COVID-19 National Emergency Partial Claim only once. If you need help with missed payments in the future, we may have other solutions for you.
  • A repayment plan where the amount due from the missed payments is divided into manageable amounts and spread out over time. This would increase your regular mortgage payments for a while, but would bring the mortgage up to date.
  • A loan modification where certain terms of the loan are changed – such as the interest rate or time allowed for repayment – to make payments more manageable. This program is intended for people experiencing long-term financial hardships.

Homeowners who were up to date on their mortgage payments as of March 13, 2020 (or less than 30 days past due), with mortgages owned or guaranteed by the USDA or the VA, are not required to repay missed payments all at once.

Programs may include:

  • A repayment plan where the amount due from the missed payments is divided into manageable amounts and spread out over time. This would increase your regular mortgage payments for a while, but would bring the mortgage up to date.
  • Payment deferral where the amount of the missed payments is added to the end of your loan term. This would extend the loan term by the number of missed payments.
  • A loan modification where certain terms of your loan are changed — such as the interest rate or the time allowed for repayment — to make payments more manageable. This program is intended for those experiencing long-term financial hardships.

Depending on your loan status, we may be able to move missed payments to the end of your loan term. These missed payments would be due all at once when you pay off or refinance your mortgage.

If your account is not eligible to have the missed payments moved to the end of the account term, we will work with you to discuss other programs to make up the missed payments.  We may need to gather your financial information to review and qualify you.

We’ll consider your financial situation and account status to help us determine if you’re eligible for one of these programs:

  • A repayment plan where the amount due from the missed payments is divided into manageable amounts and spread out over time. This would increase your regular mortgage payments for a while, but would bring the mortgage up to date.
  • A loan modification where certain terms of your loan are changed — such as the interest rate or the time allowed for repayment — to make payments more manageable. This program is intended for those experiencing long-term financial hardships.

Homeowners who can afford to do so can repay the payments missed before the suspension period all at once to bring the account current then continue with normal payments. We understand that some people may not be able to do this and we have other programs available if needed. We can consider the homeowner’s financial situation and loan status to help us determine eligibility for one of these programs. Additional financial information may be required to review and qualify the homeowner for the solution. Programs may include:

  • Payment deferral where the amount of payments missed during the payment suspension period is added to the end of your loan term. These missed payments would be due all at once when you pay off your mortgage, refinance, or no longer own the home. For payments missed prior to the payment suspension period, we will not be able to add these to the end of the loan term.  In this case, we will discuss programs with you to help you catch up.
  • A repayment plan where the amount due from the missed payments is divided into manageable amounts and spread out over time. This would increase your regular mortgage payments for a while, but would bring the mortgage up to date.
  • A loan modification where certain terms of your loan are changed — such as the interest rate or the time allowed for repayment — to make payments more manageable. This program is intended for people experiencing long-term financial hardships.

If you don’t think that you will be able to resume your mortgage payments at the end of the payment suspension period, contact Wells Fargo right away, before the end of your payment suspension period. We may be able to discuss longer-term help.

Here is what we report to consumer reporting agencies:

  • If you elect to resume payments, we will usually report your loan’s current or delinquent status, along with other loan details, each month.
  • Depending upon how your suspended payments are resolved, we may report a special comment code that indicates you were previously affected by the COVID emergency or received a hardship modification.
  • If a trial payment plan is used to resolve your suspended payments and you pay in accordance to its terms, we will not report the delinquency status of your loan during the trial period.
  • If you make larger payments for multiple months to resolve the suspended payments through a repayment plan, we will not report to consumer reporting agencies during the repayment plan period.

The Consumer Financial Protection Bureau (CFPB) offers the Homeowner’s Guide to Success which explains what to do if you can’t pay your mortgage. It also explains other consumer protections and what your next steps are.

 

How to determine who the investor is for your loan

For new payment suspensions, a letter will be sent to you 7-10 days from your request for suspension telling you who your loan’s investor is and your repayment options.

For others, a letter will be sent to you a month before your three-month payment suspension period ends that tells you who the investor is as well as details of the programs that may be available for your loan.

You can find out if your loan is through Fannie Mae or Freddie Mac by visiting these sites or calling us at 1-877-937-9357.

For additional information on the CARES Act protections, visit the Consumer Financial Protection Bureau’s site.

 

(Return to Answers to frequently asked Mortgage and Home Equity Questions.)