Being able to defer payments during times of financial hardship can provide much needed relief to those in need. However, money problems do not always get better with time. Maryland homeowners who were behind on their mortgage payments might still be struggling by the time their deferrals end. For these individuals, bankruptcy might be a smart solution.
The foreclosure moratorium is a program that lets homeowners essentially press pause on mortgage payments if they are experiencing financial difficulties. Although originally set to end earlier, it was recently extended to the end of June 2021. A program that allows student loan borrowers to pause payments on their federal loans was extended through Sept. 2021.
Consumers have also found relief in other areas of financial stress, too. Some utilities and even credit card companies have voluntarily allowed their customers to take a break from making payments. The foreclosure moratorium will eventually come to an end though along with other forms of financial reprieve, leaving millions of consumers unable to make payments on their:
- Car loans
- Credit cards
- Student loans
Over 10 million homeowners — including many in Maryland — were struggling with past due mortgage balances in early 2021, and the situation is unlikely to have improved much since then. Taking proactive steps to protect one’s self when the moratorium ends might be wise, especially in the wake of job loss or unexpected financial emergencies. For someone in this situation, bankruptcy might be one of the wisest courses of possible action.