Do You Really Intend to Pay?

Dear borrower, please sign here if you intend to pay your mortgage.

That's the amusing state of affairs as Covid laws allow borrowers to skip payments for a full year.

New Question: Do You Really Plan to Pay This? 

Some mortgage lenders are asking customers taking out a mortgage to confirm they don’t intend to seek forbearance, a move meant to keep losses low during a pandemic that has put millions of Americans on shaky financial footing. 

The unusual requirement comes in the form of a new document included in many borrowers’ closing paperwork. While the language varies, the forms generally tell borrowers that they won’t be allowed to skip payments until their loans are backed by the government, according to forms reviewed by The Wall Street Journal. The forms, known among lenders as “Covid-19 borrower certifications,” often ask home buyers to confirm that they don’t expect changes to their income. Some warn of potential penalties if any of the certifications are later proven to be false.

The New Liar Loans

Since it is impossible to prove intent, the question seems moot.

But the wording tells all you need to know.

Lenders do not want borrowers to skip payments until their loans are backed by the government, after which the lender no longer gives a damn.

Meanwhile, it can take days, weeks or sometimes even months for a newly made loan to get government backing.

Delinquencies Soar

New Home Surge to a 13-Year High

Despite the concern and the delinquencies, note that New Home Surge to a 13-Year High With the Midwest Leading the Way.

Mish

Pay Hikes in 2020: What Do You Expect?

Every month the New York Fed does a survey of household expectations. Let's take a look at the findings.

Yellen Asks Congress for Pro-Growth Policies, Ducks Question on Taxes

Janet Yellen appeared before Congress today. She ducked a question on taxes and asked Congress for pro-growth policies.

Household Debt Hits Record High $13.29 Trillion Led by Mortgages, Student Loans

A New York Fed report shows household debt hit a new record high of $13.29 trillion in the second quarter.

Happy New Year Wherever You Are

New Year's celebrations were cancelled or subdued in many location. But there were great celebrations in some places, especially down under.