The U.S. Department of Housing and Urban Development (HUD) has extended the foreclosure and eviction moratoria to June 30 for loans backed by the Federal Housing Administration (FHA).
HUD initially announced the moratoria on March 18 last year, extending it five times afterward to help keep borrowers in their homes during the dire economic straits of the COVID-19 pandemic. The move follows suit with the Federal Housing Finance Agency (FHFA), which recently announced an extension of moratoria for loans backed by Fannie Mae and Freddie Mac until March 31. Similar extensions of moratoria regarding loans backed by the U.S. Department of Agriculture (USDA) and Department of Veteran Affairs (VA) have also been announced; those suspensions will now likewise last until June 30.
The moratorium extension is one of a flurry of changes announced by HUD to aid American homeowners still financially burdened by the ongoing COVID crisis. An extension was also announced to the initial start date of a COVID-19 forbearance, giving borrowers who have been impacted by the pandemic until June 30 to request the start of a forbearance period. Furthermore, COVID-19 forbearances have been expanded to allow up to two extensions of up to three months each.
HUD is also allowing more borrowers access to COVID-19 loss mitigation options by expanding the FHA’s home rentention and home disposition programs to all borrowers who are behind on their mortgage payments by at least 90 days. This expansion, according to a release from HUD, will require mortgage servicers to assess more homeowners for a streamlined waterfall of loss mitigation home retention options, starting with FHA’s COVID-19 Standalone Partial Claim.
Finally, to help seniors carrying home equity conversion mortgages (HECMs) insured by the FHA, the timeframe for the start of an initial COVID-19 HECM extension has been extended to June 30. Two additional HECM extensions of up to three months each have also been provided.
“HUD believes these additional measures will provide mortgagees a better toolbox with which to assist borrowers in recovery from the impacts of the pandemic,” according to a mortgagee letter from HUD. “HUD believes that the extension of these moratoria, in addition to the increased eligibility of borrowers for loss mitigation, will help marginalized communities that have been disproportionately impacted by the COVID-19 pandemic.”
“As President Biden has made clear, it is urgent that we help homeowners throughout the nation who are struggling financially from this unprecedented national emergency,” said acting HUD Secretary Matthew Ammon. “The steps we are taking today will provide both immediate relief to those in desperate need of assistance and help more homeowners keep their homes and resume their payments when the pandemic subsides.”