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The end of COVID-19 homeowner protections is unlikely to bring a wave of foreclosures, but some Chicago property owners could be hit harder

Sarah Freishtat, Chicago Tribune on

Published in Business News

She entered the forbearance program to try to catch up, and said she continued to try to make some payments. When the servicer ended her forbearance 10 months later, the company told her she didn’t qualify for repayment plans available to some borrowers, McCormick said. The company had added additional charges, including for taxes and insurance, which McCormick challenged.

In May, Diamantes was told she owed $11,321. To Diamantes and McCormick, it seemed the option left to her by the servicer was to make the full payment at once.

As servicers navigate a variety of forbearance rules governing different types of loans, McCormick expects to see other, similar situations arise.

“This is a prime example of somebody who used the system to try to catch up on stuff and she tried to fix a problem they had and the benefit wasn’t there because the servicer did something wrong,” McCormick said.

Shellpoint declined to comment on an individual situation, citing privacy laws. The company referred questions about its mortgage and pandemic forbearance processes to a COVID-19 page on its website.

 

Diamantes and McCormick are still working on options for her overdue payments. Diamantes worries about losing her family home, but thinks she’ll find a solution before losing the property, she said.

She thinks of passing the house on to her children, though she said it would need significant updating. Or maybe she will sell it.

In the meantime, she has watched the amount she owes grow.

“It’s worrisome,” she said. “It’s very worrisome.”

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