Staying Financially Well During the COVID-19 / Coronavirus Outbreak

The United States is in a state of flux as the Federal government and State and local governments decide on what measures it will take to contain the COVID-19 / Coronavirus outbreak. As important as it is to stay physically healthy, it is also vital to Maryland families to stay financially well during the COVID-19 / Coronavirus Outbreak. Industries that rely on travel and face-to-face interaction have been significantly affected, including airline workers, travel agents, restaurant workers, construction workers, and retail employees, to name a few. There are steps that Maryland families can take today to stay financially well during the COVID-19 / Coronavirus Outbreak.

Mortgage Payment Relief

Many mortgage lenders and servicers are willing to work with borrowers through this difficult period. The first step is to quickly reach out to your mortgage servicer directly to discuss payment options. Specifically, you can request a delay in payments and there are many special waivers that mortgage lenders and servicers have put in place due to COVID-19/ Coronavirus. It is important not to wait until you have fallen behind on mortgage payments to do this but instead to be proactive. Also, keep in mind that while you may have a delay in mortgage payments, you will eventually have to pay back whatever months are missed.

Stays on Foreclosures and Evictions

The federal government has issued HUD No. 20-042 which immediately places a 60-day moratorium on foreclosures and evictions for all FHA-backed loans. According to HUD Secretary Ben Carson, “[t]oday’s actions will allow households who have an FHA-insured mortgage to meet the challenges of COVID-19 without fear of losing their homes, and help steady market concerns,” said HUD Secretary Ben Carson. “The health and safety of the American people is of the utmost importance to the Department, and the halting of all foreclosure actions and evictions for the next 60 days will provide homeowners with some peace of mind during these trying times.”

Federal Housing Commissioner Brian Montgomery stated that “[t]his is an uncertain time for many Americans, particularly those who could experience a loss of income. As such, we want to provide FHA borrower households with some immediate relief given the current circumstances,” and “our actions today make it clear where the priority needs to be.”

In Maryland, Chief Judge Mary Ellen Barbera of the Court of Appeals issued an Administrative Order On Suspension of Foreclosures and Evictions During the COVID-19 Emergency. Specifically, the Order provides that “[f]oreclosures of residential property, foreclosures of the right to redeem residential property sold in a tax sale, and residential evictions present the strong likelihood of creating undue hardship if completed during the pendency of the emergency,” and therefore “[t]hose foreclosures of residential properties and foreclosures of the rights of redemption of residential properties pending in the circuit courts shall be stayed effective immediately; and [r]esidential eviction matters pending in the District Court of Maryland and all pending residential eviction orders shall be stayed effective immediately; and (c) [n]ew foreclosure of residential property, foreclosure of rights of redemption after a tax sale, and residential evictions shall be stayed upon filing…”

Chief Judge Barbera did not place a time limit on her Order, which means that until she orders otherwise, the stay on foreclosures and evictions is in place.

Auto Payment Relief

Many auto lenders will offer first payment deferrals of between 90 and 120 days for new car buyers. For existing car owners, it is important to quickly contact the lender and request that payments be deferred. Similar to mortgages, you will eventually have to pay the deferred payments back, so make sure to plan ahead as well.

File For Unemployment and Request Paid Sick Leave

President Trump signed the Families First Coronavirus Response Act on March 18, 2020 which includes additional provisions for unemployment insurance. The Act provides that for additional funds to be provided to states, including Maryland, for unemployment insurance claims.

The Act also provides for paid sick leave to employees that are not able to telework because either 1) the employee is subject to a Federal, State, or local quarantine or isolation order COVID-19; 2) the employee has been advised by a healthcare provider to quarantine; 3) the employee is experiencing symptoms of COVID-19 and seeking a medical diagnosis; 4) the employee is caring for an individual who is quarantined or been advised to quarantine by a healthcare provider; 5) The employee is caring for a son or daughter of such employee if the school or place of care of the son or daughter has been closed, or the child care provider of such son or daughter is unavailable, due to COVID–19 precautions; or 6) The employee is experiencing any other substantially similar condition specified by the Secretary of Health and Human Services in consultation with the Secretary of the Treasury and the Secretary of Labor.

Do Not Cash Out Retirement or Savings Accounts

Although using savings and cashing out a retirement account may seem like a prudent measure to take, many times, these assets can be protected both in and out of bankruptcy.

Steiner Law Group, LLC has helped many clients through difficult life situations, and with proper planning, important assets can be protected. If you have questions about bankruptcy or asset protection, please contact us at (410) 670-7060.