In a recent announcement, New Jersey Gov. Phil Murphy revealed the details of a 90-day grace period for mortgage payments for all New Jersey homeowners that have been financially impacted by the outbreak of the coronavirus. This will allow New Jersey residents a brief reprieve from the financial pain that the virus has spread around the state and country.
Governor Murphy announced the grace period after reaching an agreement with major national mortgage lenders, banks and state-chartered lending institutions.
As unemployment insurance filings have skyrocketed in the state, Murphy is hopeful that the 90-day grace period will give some New Jersey families more financial breathing room. “Together, a 90-day grace period and a moratorium of foreclosures and evictions means many New Jersey families can breathe easier, keep their heads above water, and have a place they can continue to call home,” the governor said in a recent NJ.com article.
If you have questions about the new relief period, we have answers, here are some common concerns:
Who is eligible to defer their mortgage payments: Any New Jersey mortgage borrower who has been affected by the virus outbreak can request a 90-day grace period on mortgage payments. It should be noted that documentation of your loan and the impact of coronavirus on your finances will be required.
Who do I Contact: The Governor reached an agreement with most banks and mortgage companies but it is largely up to residents to contact their lender and work out the details of the reprieve. “How exactly it plays out is between the mortgage payer and the bank that’s providing it,” he said in the article.
When Will I Have to Pay Missed Payments: These details are to be worked out with your bank but in most cases, you should not have to make a large lump sum payment in 90 days to cover the missed payments. According to Murphy all of the banks his administration has worked with have agreed to tack the missed payments onto the end of the mortgage, so homeowners are not hit with a major lump sum payment.
Will There Be Late Fees: According to the Governor, all fees should be waived, including late and early withdrawal fees.
Which Banks Are Participating: The Governor reported that Citigroup, J.P. Morgan & Chase, U.S. Bank, Wells Fargo and Bank of America as well as 40 other financial institutions are currently working with the governor to help ease the strain on New Jersey residents.
Will These Deferred Payments Hurt my Credit Score: No, the grace period will have no impact on your credit score.
Are Renters Covered: While there have been no formal announcement regarding a rent freeze, the Governor did ask landlords to have compassion during the crisis, particularly if that landlord is receiving mortgage relief on their rental. “For any landlord who is getting mortgage relief today — we expect you will in turn provide similar relief to your tenants,” said the Governor.
Can I Still Be Evicted: Banks that have agreed to work with the state will delay eviction and foreclosure proceedings for at least 60 days. Landlords are currently not allowed to kick out tenants, the Governor has placed a moratorium on evictions for up to two months after the state of emergency is lifted March 21.
“To every landlord – now is a time to show some compassion, and to work with your renters to ensure they stay safe. You cannot evict anyone at this time. If you try to, we’re not going to take that lightly, and we will make an example out of you for violating the law,” the Governor said during a recent press briefing.