As the American economy sputters amid measures put in place to stem the spread of the coronavirus, many people have found themselves struggling to meet their regular financial obligations, including housing costs.
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As previously reported by FOX Business, 18 percent of Americans said someone in their household had been laid off or had hours reduced due to the coronavirus outbreak, according to a recent NPR/PBS NewsHour/Marist Poll of 835 adults. Those numbers could get worse as the virus spreads and more governments take measures to limit person-to-person contact.
Housing costs are often one of the biggest components of a family’s budget. The average monthly mortgage payment as of 2017 was around $1,500, according to data from the U.S. Census Bureau.
The government is planning on making direct cash payments to American households for around $1,200 next month – which is unlikely to cover the costs for most people, particularly when other financial obligations are taken into consideration.
As previously reported by FOX Business, if you find yourself in a position where you don’t think you can meet your regular payments, the first thing you should do is contact your creditor or lender.
“The best advice is really to get in touch with your lenders and other creditors and advise them of your situation,” Greg McBride, chief financial analyst at Bankrate.com, told FOX Business. “There are a lot of options on the table if you’re proactive and reach out. Not so much if you fall behind and they have to track you down in two months.”
McBride noted that mortgage and car payments – typically the two biggest parts of the average household budget – could also be the two classes of lenders most willing to work with you on a financial solution.
Meanwhile, the government is working on relief for many Americans who have found themselves with reduced hours – or out of work completely – through no fault of their own.
Last week, the Trump administration announced a moratorium on foreclosures for homes with mortgages backed by Fannie Mae and Freddie Mac. Those same homeowners will be able to defer payment on their mortgages for up to a year if they have lost employment due to the coronavirus.
And more relief is likely on the way.
On Twitter on Monday, Independent Vermont Sen. Bernie Sanders – a 2020 presidential candidate – for example, proposed the suspension of rent and mortgage payments, evictions and foreclosures across the country.