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Pattie Lovett-Reid

Chief Financial Commentator, CTV


It is hard to believe the mortgage deferral program is about to hit the seventh-month mark. While a mortgage deferral isn't payment forgiveness, it has been a financial lifeline during COVID-19. 

​In an ironic twist, mortgage deferrals and government aid have resulted in fewer bankruptcies despite the high level of debt Canadians continue to carry and the job losses amassed during the pandemic. However, stress is mounting for those still unemployed as the fear of a second wave escalates. Those working in hard-hit industries like hospitality, retail, and the airlines recognize there isn't an easy financial solution and that they could find themselves struggling for the long term.

Many forms of financial support were a Band-Aid approach never intended to be long term.  Nor was the support expected to solve the financial challenges facing Canadians who were struggling pre-pandemic.

For some, the impact of financial support programs winding down will result in payment drop-offs and financial pressure will be inevitable. Those mortgage payments that were a challenge pre-pandemic and couldn't be paid still are unlikely to be paid. 

What are your options if you can't pick up and resume your mortgage payments?

1. Don't wait for your lender to reach out to you. The ball is in your court. It is your mortgage and your financial obligation. Now is the time to potentially ask for a further extension or even look for a co-signer. 

2. Explore a reverse mortgage and look to take some of the equity out of your home.

3. Talk to family members who may be in a position to help with a bridge loan. 

4. Explore home equity lines of credit or even an emergency credit card that you tucked away.

5. Explore refinancing. Your lender may be willing to let you refinance your mortgage and lower the payment by extending the amortization. 

Finally, some may be faced with the reality that their home needs to be sold. This doesn't mean you will never own a home again. It may mean downsizing or renting for now simply makes more financial sense.