April 11th, 1968 was when the U.S. passed the Fair Housing Act, and it prevented discrimination based on race, color, religion, or country of origin when buying a home, renting a home, or getting a mortgage.
This is something that is hard to believe for people that are younger, but for those that us that are older, underwriting guidelines prior to this Act used to be crazy and they could discriminate based on all kinds of things. In 1974, sex was added to the list and in 1988, disability and familial status was also added.
So how is this act enforced? With this Act was the creation of the HUD (Housing of Urban Development),that oversees the housing market. They actively look for people that are violating this national law. It specifically says you cannot discriminate based on all of these classifications and they put money behind it, which is a great thing. Their employees go door to door and check your open house listings, check your rental open house, and make sure that you’re following the Federal law. On March 31, 2020, $40 million was given to fair housing organizations by HUD to enforce the Fair Housing Act and also to provide grants for low-income housing. So it’s a really big deal. Obviously, the Coronavirus has eclipsed so many other news stories, but this is a bright light out there in the otherwise dismal list of things going on.
As part of the Cares Act, that was just passed by legislature. It also ties into this in that they’ve included a 120 day moratorium on evictions (this is the federal government, not city or state) and 180 day forbearance is available to you for both your mortgages for one to four multi-unit families. Of course that includes condos and townhouses. Really what it includes, and why I’m talking about these in concert is because everything that falls under the purview of the Fair Housing Act, so that is FHA loans, VA loans, USDA loans, Fannie, Freddie, all of those are subject to the Fair Housing Act, as they’re all secondary mortgage market providers. So if you need forbearance, or if you are concerned about being evicted, in almost all of these cases you are under that umbrella of protections.
I know this is a hard time guys and things are changing rapidly – please reach out because I’m here to help.
I have talked to several servicers about people needing to delay payments, and each servicer of mortgages is doing this a little differently. Originally, they would say hey, we’re going postpone your payments for a certain amount of time, but at the end of that time you’re going to have to come up with that balance of all of those payments all at once or they’ll start the eviction process. Obviously, this is not helpful to most people, especially if you have a regular job or you were furloughed, you’re not going to have $10,000 to pay for three months of mortgages. So what I have found out is that some services or servicers are now just taking those three payments and tacking them on to the end of your loan. So in essence, you don’t have a balloon payment in three months; you just have, three more months than you thought you were going to have on your 30-year loan.
I have also had a lot of people reach out about refinancing. Mortgage rates are really good right now, especially if you just have a regular house or condo. Interest rates are really low – below 4%. So if you need a recommendation for a lender, I’m happy to give it.
Just so you guys know I am still working, I am still here in the office. We’ve been deemed essential services by the Governor, which means that I get to still work, I can still show property, I have a mask, I have a bunch of bleach wipes and I have lots of hand sanitizer. Of course we keep our six feet distance when we look at properties. We’re also using something called Matterport on all of our listings so that you can view things from the comfort of your own home, before you decide that you want to go out and see it in person. So it’s been fascinating how much the industry has innovated to try and keep up with all of the new social distancing laws and we’ll continue to do so.
Reach out to me with any questions. I’m here for you. I’m happy to help in any way I can. And if you have any other questions, please comment or direct message me. I will be happy to address it. You guys all stay safe and stay sane and we’ll talk soon take care.