Mortgage companies may soon be dealing with a massive cash crunch. That's because many Americans won't be able to make payments on their home loans.
Now, firms are lobbying Congress for billions of dollars to finance the payments American homeowners can’t make.
“This will test the financial system including the mortgage system in ways it’s never been tested before,” Mike Calhoun, the President of the Center for Responsible Lending in Washington, D.C, told KTRH.
Calhoun says firms are still on the hook for payments to investors, even if homeowners lose their jobs and income. His advice to mortgage holders in a pinch:
“Be proactive and contact those companies and tell them that you need this help. You are entitled to it,” Calhoun said. “It could really make a difference in people getting through this crisis.”
He warns that if mortgage companies can’t make their payments, it may make it much harder for first-time buyers to get a loan in the future.