New Jersey homeowners whose finances have been affected by the novel coronavirus will get a 90-day reprieve on their mortgage payments, said Gov. Phil Murphy on Saturday.
Lenders will also waive late fees and other expenses that borrowers would otherwise incur due to the grace period, Murphy announced in a tweet.
The banks are offering a mortgage payment forbearance of up to 90 days for COVID-19 related reasons. In a forbearance, mortgage holders can pause or reduce the amount they pay each month for a specified period of time.
Under the deal with New Jersey, lenders will provide homeowners with a streamlined process to apply for forbearance. They will offer borrowers a chance to ask for more relief, if they continue to show they're facing hardship related to coronavirus.
In general with forbearance, borrowers are expected to make up the payments missed at a later date. Homeowners should pay close attention to the terms of the contract when asking for a reprieve on a mortgage.
More than 40 lenders, including Citi and JPMorgan Chase, are working with New Jersey on mortgage relief, Murphy said. The banks have also committed to not initiating foreclosure cases or eviction proceedings for at least 60 days, he said.
"This grace period CANNOT and WILL NOT be used to downgrade anyone's credit rating," Murphy tweeted.
More than 11,000 New Jersey residents have tested positive for COVID-19, according to Murphy. At least 140 people in New Jersey have died from it.
The governor also expects landlords to keep their tenants in their homes.
"To any renter facing eviction, let me be clear—under an executive order your landlord cannot kick you out of your home during this emergency," Murphy tweeted.
"For any landlord who is getting mortgage relief today – we expect you will in turn provide similar relief to your tenants," he said.