By Joanne Bailey-Boorsma
joanne@wktv.org
With the federal extension on foreclosure and eviction suspensions set to end Saturday, representatives from Home Repair Services of Kent County says now is the time to communicate with your lender to work out a payment plan.
“What we’re seeing is a lot of people just hearing ‘call in’ and ‘pause mortgage payments’ without really understanding that eventually that money has to be paid back somehow,” said Rodrigo Ortiz, Housing Counseling and Education Program Manager at HRS. “It’s not something that’s forgiven.”
For example, a person who was making a $1,500 house payment but decided to ‘pause’ their payments for the last 12 months would owe $18,000 in back mortgage payments on top of the regular mortgage payments they now must pay. That hurdle, according to Home Repair Services Executive Director Joel Ruiter, can be challenging.
“It is important to be communicating with your lender and to start exploring possibilities and find solutions to avoid eviction,” Ruiter said.
Home Repair Services of Kent County is a non-profit program that works with homeowners to help educate them on their options before they lose their home along with providing classes on how to care for and improve a home. HRS is available to any resident in Kent County or counties that touch Kent County (Newaygo, Ottawa, Ionia, Barry, Muskegon, Allegan, and Montcalm). All of the HRS housing counselors are certified by the Housing and Urban Development to provide West Michigan homeowners a lifeline of counseling and education.
“We are willing to contact the lender and see what can be done,” Ruiter said, adding that in our example, HRS would see if the amount could be added on to the end of the loan. “You might go from paying on it for the next 25 years to 30, but you would still be in your home.”
Ruiter said they are not certain what the impact will be once the extension has expired. According to the Michigan Department of Technology, Management and Budget, there where 342,000 Michiganders unemployed as of November 2020 compared to 190,000 the year before. About 21,500 residents are in the Grand Rapids-Wyoming area.
“In 2008 we had the tsunami of foreclosures,” Ruiter said. “It will be interesting to see what will happen next week and in the future. It will be a little different as it probably will not be as deep as 2008, but there are still going to be some folks who have gotten swept up in delaying those payments.
“It has been a challenging year and we know there are folks in the community who are facing the possibility of losing their home. When you lose your home your cost of living goes up because rents have gone up plus the upheaval of having to move. Then there is the amount of time it takes to get the credit you need to purchase another home and then the market barriers of just reentering the housing market. It really adds up which is why we just want people to stay in their homes.”
Property Taxes Were Never Exempt
Kent County Treasurer Peter MacGregor said he too wants people to stay in their homes which is why he works with Kent County residents who are delinquent on their property taxes. The county does not have anything to do with mortgages.
One thing many people do not realize is that property taxes were never exempt during the pandemic with people expected to pay the taxes as it goes toward funding local governments, schools and other millages such as the senior millage.
“What happens is when a property owner has been delinquent, the county then pays the local city or township the missing property taxes and then we become the enforcer to collect those taxes,” MacGregor said. The process can take up to three years before the county will foreclose on a house which means those who have not paid property taxes during the pandemic would face foreclosure in 2023.
“I often get calls just before the foreclosure is to happen asking for help,”MacGregor said, adding that people should not wait until then to reach out. “Communication is key.
“There are people who outright can’t pay their local taxes right now because they are struggling. Work with me to make an arrangement so that in two and half years I am not foreclosing on your home.”
Kent County residents who are delinquent on their property taxes can reach out to MacGregor, who is able to grant extensions however, MacGregor pointed out that he does have to follow statute and that there is interest that can accrue on delayed payments.
“I am here to help and I would much rather help than foreclose on a home,” MacGregor said. “To be honest the county does not want your house.”
In fact, MacGregor said his office has had about a 92/93 percent success rate in helping resolve delinquent property taxes.
For those in need of property tax assistance, contact the Kent County Treasurer’s Office at 616-632-7500. For mortgage assistance, Home Repair Services of Kent County, located at 1100 S. Division Ave., can be reached at 616-241-2601.
