As COVID-19 spreads across the country, many people have already lost their jobs or have been laid off while small businesses close or limit their hours. Often the next question for those concerned is, “How will I pay my mortgage or my rent?”
Well, help seems to be on the way as the federal government prepares to announce massive aid worth over $ 25 billion on Wednesday to help Canadians and small businesses get through the crisis. COVID-19 crisis, CBC News-Radio Canada learned. .
But private banks and lenders have already announced they are taking action.
In a statement released Tuesday evening, TD Bank announced that the country’s six largest financial institutions “will provide financial relief to Canadians affected by the economic consequences of COVID-19.
“Effective immediately, Bank of Montreal, CIBC, National Bank of Canada, RBC Royal Bank, Scotiabank and TD Bank are committed to working with personal and small business customers in case by case in order to provide flexible solutions to help they manage through challenges such as wage interruptions due to COVID-19, disruption of child care due to school closings, or those facing illness COVID-19 “, said the press release.
“This support will include a deferral of payments of up to six months for mortgages and the possibility of relief on other credit products.”
Some lenders, such as RMC Mortgages, have also sent emails to their customers regarding “hold or default” options.
The federal package to be announced on Wednesday could also include help to keep people above their heads. The government said on Friday that it would help people financially to make sure they can pay their rent or their mortgages.
“We are looking for ways to help Canadians directly, yes,” said Prime Minister Justin Trudeau.
Early the next day, CMHC tweeted that it “will help lenders authorize deferred mortgage payments for up to six months for those affected [by the coronavirus]. ”
No one should have to worry about their #mortgage due to the 💰 impacts of #COVID-19. We are working with lenders to assist you, increasing our flexibility to allow deferral of payments up to 6 months from now. Find out more: https://t.co/oLrC4D24zI pic.twitter.com/QKT18Z2WLJ
This help will come if your mortgage is already insured by CMHC, which usually happens if you pay less than 20% of the purchase price when you bought your property.
Genworth Canada and Canada Guaranty will also authorize the deferral of mortgage payments on insured mortgages.
If your down payment was 20% or more, you probably don’t have an insured mortgage. But in a statement released Tuesday, CMHC said it is also looking into options to help you.
CMHC will try to help tenants
“We are also considering, with others, possible relief measures for those who cannot make payments on mortgages and uninsured tenants,” said Evan Siddall, President and CEO of CMHC .
What this means for tenants and those with uninsured mortgages is not yet clear.
In a series of tweets, Sidall said that he understood that tenants are often in more precarious situations and even though “we do not have direct relationships with tenants, income support measures (announced and to come ) will help tenants.
“We have written to our owner customers to insist that no evictions be made,” said Sidall.
For homeowners, the important thing to understand now, said mortgage broker Tom Miocevich, is what type of mortgage you have and what are the best options for you.
For example, “if you are on a biweekly frequency and are ahead of schedule for a few months,” some banks already offer a payment break program which is relatively easy, said Miocevich.
CMHC had a deferral program in place long before COVID-19, but the duration granted was on a case-by-case basis, often less than six months.