What if I can't pay my mortgage?
Sandra Bussey , High Net Worth Planner, TD Wealth
Paul Faykiss , Associate Vice President Real Estate Secured Lending, TD
These are unprecedented times. Hard-working, responsible people are finding themselves sick, temporarily unemployed or unable to work due to family obligations. If COVID-19 has you worried about how you’ll pay your mortgage, there are options available to help support you during this difficult time, such as the TD Mortgage Deferral Program.
Here’s what you should know.
What is mortgage deferral? And how could it help me?
A mortgage payment deferral allows you to suspend your mortgage payments for an agreed-on, temporary amount of time which can be helpful when you're facing a financial hardship, like unemployment or reduced employment due to Coronavirus or COVID-19.
As a TD mortgage customer you can request to defer the equivalent of up to 6 monthly payments due to COVID-19.
If you choose to apply for mortgage payment deferral, keep in mind that once a mortgage deferral ends, your mortgage payments go back to normal. The deferral has increased your amortization period and the total amount of interest you will have to pay.
What is the mortgage relief offer?
The mortgage deferral offer is a pause on mortgage payments themselves, not a forgiveness of the mortgage payment obligation. Interest will continue to accumulate and be added to your debt. The interest will be compounded on each payment due date. There is also an option available to pause the payments on your mortgage credit protection insurance premiums.
If you think a deferral of payments may be right for you, you can find out more about TD relief offers here.
Am I eligible for mortgage payment deferral?
The program is being administered on a case-by-case basis to individuals whose mortgages are in good standing, and will be available until at least September 30, 2020.
If you're directly impacted by COVID-19, and are facing financial challenges as a result, we want to be there for you.
When you request a payment deferral, you'll be asked how you've been financially impacted by COVID-19. Reasons are as follows: that you're self-isolating or caring for others, you've experienced a disruption in your income, or you've become ill.
We also understand that any reduction in household income can lead to financial hardship. That's why, even if other members of your household are employed and unaffected by Coronavirus or COVID-19 you may still be eligible for a mortgage payment deferral.
What is the application process for obtaining a mortgage payment deferral?
The easiest and fastest way to apply for your mortgage payment deferral is through the TD Mortgage Payment Deferral Form. You'll first be directed to the EasyWeb login page and asked to log in with your EasyWeb credentials. If you aren't currently registered for EasyWeb, you can register online beforehand.
On the form, you'll need to state how you're financially impacted and how many payments you'd like to defer. You'll need to enter your mortgage number, and the form will pre-populate your name as the Borrower, as well as your email and phone number.
If your property taxes are being collected and paid by TD, you can choose to defer your property taxes as well.
Should I defer my mortgage payments?
Individuals considering this option should give it careful thought: think about how it will impact their own situation and recall that the program is designed to alleviate temporary hardship due to the impact of COVID-19. Depending on the current position of your finances, it may be better to continue with your mortgage payments. If you think your unemployment or debt situation could be longer term, you might wish to discuss other options that may be available.
What should I consider before deferring my mortgage?
In order to determine whether the mortgage deferral program is for right for you, consider the following:
- Your current spending. Now is a good time to make a distinction between what is discretionary and what isn’t, what you have to pay for and what you can get by without.
- All of your debts. From your mortgage to your credit card bills, make sure you are prioritizing your debt properly. Cash saved by not paying a mortgage could, for instance, go towards paying down credit cards, even just the minimum.
- Understand the potential impact of deferring your mortgage payments. Use our Mortgage Payment Deferral Impact Calculator to calculate what payments may look like (with certain assumptions) after the deferral period is over, as well as the potential mortgage balance on the maturity date if you defer compared to if you don't.
- Check your cash flow and see what you are expecting to receive in the near future. Our Personal Cash Flow Calculator can help get a better idea of where you spend your money.
If you really are in a predicament because of the COVID-19 crisis where the disruption of cash flow is preventing you from making a mortgage payment, a deferral might be your best route.
What can I expect at the end of my six-month mortgage deferral term?
When things do get “back to normal,” remember that the total amount owing on your mortgage will be higher, due to the interest that has accumulated. As a result, you'll pay more interest in the long run. In that case, you might wonder how your payments may be handled. In the case of TD, your payments will be adjusted automatically at the start of your next term or, if you change anything else before renewal, at that time, to ensure your mortgage is paid off at the end of your original amortization period.
You can speak with your financial provider to see what other options may be available, including the potential for a lump sum payment or increasing your payments to help you get back on track sooner.
How do I apply for mortgage payment deferral?
If you think a deferral of payments may be right for you, you can find out more about TD’s relief offers here.
To apply online for TD Mortgage Deferral, complete the TD Mortgage Payment Deferral Form.
You will first be directed to the EasyWeb login page and asked to log in with your EasyWeb credentials. You will receive an email response notifying you of the outcome of your request. If you are not currently registered for EasyWeb, register online today.
DISCLAIMER: This content discusses current topics of interest in a general and informational manner only and may not be appropriate in all circumstances. Please ensure that you seek advice personalized for your situation from the appropriate professional, consultant or subject matter expert on the topic of interest to you.
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