Storm victims may get reprieve on loan payments

Loan servicers have been asked to give Hurricane Sandy victims a break if they are late on mortgage payments. If you need forbearance, you'll need to call and ask.

By Teresa at MSN Real Estate Oct 31, 2012 4:14PM

Mike Groll/APIf your house suffered damage or was destroyed during Sandy, you may wonder if you still have to pay your mortgage.


The short answer is yes, even if you no longer have a home.


But you may get a break on due dates or even a period of months when you don’t have to pay, though the unpaid balance will be added to what you owe.


Post continues below


The government-supported entities Fannie Mae and Freddie Mac have asked loan servicers to grant borrowers in the disaster zones a bit of mortgage relief: more time to make payments, a delay on foreclosure or other negotiated accommodations.

If the reason you didn’t make payments on time was because your checks were destroyed, you had to leave your home or you couldn’t go online to do your banking, having a few more days to make the payments without having your credit damaged or being assessed a late fee could be helpful.

But perhaps your home suffered more serious damage, and you’ll now be spending the next year wrestling with contractors and insurance companies in an effort to get it repaired. You may even have to rent another place to live.


If you have suffered a disaster-related hardship, it’s up to you to call your loan servicer, explain the situation and ask for forbearance or other relief. Any mortgage relief is granted on a case-by-case basis.

While Fannie Mae and Freddie Mac have asked loan servicers to grant borrowers whose loans they back some relief, there is no guarantee they will do so. It’s up to each servicer to decide how it will treat late payments. If your only issue is lack of electricity, you may want to pay as soon as possible after your power returns to avoid late fees.


Tags: loans
Nov 14, 2012 12:17PM
They still have to pay the amount due, they just tack it on the end of the loan, hence "forebearance".
Nov 3, 2012 10:27AM

Not ONE Country has to OUR Aid?  NOT ONE! 


Nov 3, 2012 10:25AM

... the "Feds" already spent it on Foreign soil to Prop the next dictators Up! 

Nov 3, 2012 9:49AM
I'm sick of the people of NY wanting free stuff. They complain that they want cash and not low interest loans. They complain that they shouldn't have to pay their mortgage. They want gas and shouldn't have to wait,, they want everything and shouldn't have to wait, they want, and want and want.....  Nobody said you have to live along the coast. Nobody made you buy there. I live in inland and don't get to walk along the beach everyday. I don't have the nice amenities that you get. So don't ask me for free money. If you want to enjoy that lifestyle, then pay for it and shut-up.  Nobody would give me free money if a tornado destroys my house. My business could be destroyed and no New Yorker would send me cash. So shut up and rebuild it yourself. You picked that town, so deal with it.  And BTW - more hurricanes are coming and sea level is rising, so you should relocate because this is just the start. But you won't because the Government will pick up the tab the next time and next time and next time.  And for those republicans who hate big government, you're all hypocrites if you are asking for handouts and monetary help from the Government. But that is the classic NY attitude. Let them eat cake (unless you need help and then you will complain about the government not helping enough). 
Nov 3, 2012 9:01AM
My home was damaged last year during the flooding of the Mississippi River.  It took me 10 months to get back into my home.  I had flood insurance and they cut me a check immediately...the reason it took so long to get my home repaired was all the HOOPS my mortgage company made me jump through.  I had to sign my insurance check over to my mortgage company and THEY would cut ME a check if THEY deemed the work had been done to THEIR satisfaction.  Just getting a contractor to work with not only me but the mortgage company as well was almost impossible to do.  In the end I did find a contractor who did a great job and who waited patiently for their money...a little at a time.  All around me I had neighbors who did NOT have flood insurance.  FEMA came in and cut them checks, and my neighbors were able to get their homes repaired quicker because they did not have the restrictions placed on them like I did.   FEMA cut them a check and if they repaired it fine, if not, that was okay too.  I find it comical that me being responsible enough to have flood insurance along with my homeowners insurance caused me not only extra money every year (flood insurance is NOT cheap), but it also caused me extra stress.  By the way...flood insurance does not cover any mold clean up.  That was an additional $8000.00 out of my pocket.     

During all this time I still had to pay my mortgage even though I was unable to live in my home for almost a year.  The mortgage company was well aware of the fact that the home was unlivable but they still wanted their reprieves for me. 
Nov 3, 2012 8:33AM

If a homeowner (those with mortgages) want to work out a deal with their lean holder, good luck with that........I just dont want any TAX money going to help.


We need to get rid of FEMA.They are proving once again that they are inefficent and a significant drain on resources.


Second, Unless these folks NATIONAL FLOOD INURANCE covers their costs, DONT DUMP THEIR POOR DECISIONS ( after all, it was THEIR CHOICE to live where they do/did) on the TAXPAYER. If the NFI cant cover the costs to rebuild, then they need to look at buying them out. Are people REALLY that stupid to keep building in harms way?!?!?! Makes me think of Sam Kinneson (sp?) and his rant about people in Africa starving because they choose to live in the "F*CKING DESERT!!!!".......


The role of the US Government is not to bail out (and for heavens sake, KEEP BAILING OUT bone heads who build in such risky locations).





Nov 3, 2012 8:30AM
After paying off three mortgages of my own. I now get to pay off mortages for other people. We wouldn't want the "banksters" to a loss.
Nov 3, 2012 8:16AM
Even if you do not have insurance, remember millions of dollars have already been donated for the rebuilding process.  Time to contact the attorney generals of both New York and New Jersey for them to have people on their staff act as an oversight person or committee to have all charitable groups report and account to their offices for all money collected to help people rebuild  to prevent fraud or diversion of the funds by politicians, administrators and others.  I think it is time that each organization list how much was collected, from whom, itemize how it was spent and who received the money by posting it on the Internet.  So much is collected in the name of charity, but little is received by the benefactors.   Time to change the process, because the public is no longer wowed by celebs, Red Cross, United Way, Catholic Charities, and the like.  The money is intended to help not feather someone's pocket.

New Orleans received 10's of millions of dollars for rebuilding and some areas still look like trash.  Those who donate money need to have transparency to see that their money is spent as they intended not the other way around.

No place in America is totally safe.  In California we build homes on hillsides, earthquake faults and areas of frequent fires

Along the Gulf Coast and Florida there is the annual hurricane season. It comes without fail.

In the midwest  flooding or drought, and twisters,

In the upper midwest bitter cold, blizzards and ice storms

In the northeast, well it is generally relatively safe except for once every 50 years or so (though that is becoming more frequent)  when a killer nor'easter strikes.

"From sea to shining sea."

 We are all in this together.  We are Americans and we help our fellow citizens when disaster hits. 

Yeah, that's what we do.  
Nov 3, 2012 7:55AM
The insurance industry is organized crime supported by congress with the senate as their investors. Insurance should be a CO-OP run by its members instead of a private corporation run by the greediest people on earth. There is another story posted "Value of White House up from four years ago" that refers to the Government and the Military as thriving industries. That makes the military a group of mercenaries that work for crooks that run this country.
Nov 3, 2012 7:45AM
Nov 3, 2012 7:44AM
Where will all these wanna bee politicians when everyone stops payng taxes.  You keep paying, they keep taking and spending and you get no reprieve, doesn't every American citizen see what is going on here.  They manage your money, don't hurry to help you out when you really need it.  Give it to foreign aid, you bet, but help the taxpayer, no way, America wake up and smell the roses.  United you will stand and take down all the real corrupution in this country, starting with government, lenders and the big banks, if you don't take a stand you will be dying from the cold and wet weather cast upon you.  Does anyone see the picture I am seeing or have you not been hurt by these very same people who call themselves American
Nov 3, 2012 7:34AM
The same rules should apply to the government...$17 trillion dollars... late on your note and racked up to much debt .....your fired and knocked to the bottom of the heap.

It is REQUIRED, that anyone with a mortgage, also has Home Owner Insurance. If a Home Owner doesn't buy Insurance on their own, then the Mortgage company will purchase a policy for them, usually at a higher rate. If a Mortgage company let some of their clients slip through the cracks, then to bad, so sad for them. 


On the other hand however, if my home burns down or gets blown away by a tornado, I expect my insurance company to cover my loss. If they don't cover it, then I will be packing up my guns and paying the CEO of my insurance company a visit in person.

Nov 3, 2012 7:00AM
If the government had to adhere to the same money practices they force on the tax payers they would have gone bankrupt long ago.........
Nov 3, 2012 6:48AM

That's mighty white of the bankers and the mort. folks to give the hurricane damaged  owners a break what with the power down,banks closed and the all impotant and highly flanted mass transit system complete shut down.

Then again is it really so smart to fund homes that sit on a BARRIER island ??

Just declare it a national island and make them move so where safe like the city!

And now you know.

Nov 3, 2012 6:46AM
avatar if your home was completely destroyed will insurance cover that and rebuild your home or find you a new home. If not why do you still have to pay mortgage on a home you no longer have.

Nov 3, 2012 6:10AM

living on the water is a great and beautiful thing until the water becomes angry. Agry water is one of the ugliest things you will ever experiance. Sooner or later it will become angry and come for you.


Nov 3, 2012 5:54AM
After flood damage here in Va.  State Farms came in and inspected my home.  They were great.
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