FHFA Extends COVID-19 Forbearance Period/Foreclosure and REO Eviction Moratoriums; Aligns Mortgage Relief Policies Across Government
The Federal Housing Finance Agency on Thursday announced extensions of several measures to align COVID-19 mortgage relief policies across the federal government, a move that drew praise from the Mortgage Bankers Association.
FHFA announced that Fannie Mae and Freddie Mac extended the moratoriums on single-family foreclosures and real estate owned (REO) evictions until June 30. The foreclosure moratorium applies to Enterprise-backed, single-family mortgages only. The REO eviction moratorium applies to properties that have been acquired by an Enterprise through foreclosure or deed-in-lieu of foreclosure transactions. The current moratoriums were set to expire on March 31.
FHFA also announced that borrowers with a mortgage backed by Fannie Mae or Freddie Mac may be eligible for an additional three-month extension of COVID-19 forbearance. This additional three-month extension allows borrowers to be in forbearance for up to 18 months. Eligibility for the extension is limited to borrowers who are in a COVID-19 forbearance plan as of February 28, 2021, and other limits may apply. Further, COVID-19 Payment Deferral for borrowers with an Enterprise-backed mortgage can now cover up to 18 months of missed payments. COVID-19 Payment Deferral allows borrowers to repay their missed payments at the time the home is sold, refinanced, or at mortgage maturity.
“Borrowers and the housing finance market alike can benefit during the pandemic from the consistent treatment of mortgages regardless of who owns or backs them,” said FHFA Director Mark Calabria. “From the start of the pandemic, FHFA has worked to keep families safe and in their home, while ensuring the mortgage market functions as efficiently as possible. Today’s extensions of the COVID-19 forbearance period to 18 months and foreclosure and eviction moratoriums through the end of June will help align mortgage policies across the federal government.”
MBA President and CEO Bob Broeksmit, CMB, issued statement commending FHFA’s decision to align its COVID-19 mortgage relief policies with HUD, VA and USDA:
“MBA appreciates that FHFA has coordinated with the various government-backed loan providers to align Fannie Mae’s and Freddie Mac’s COVID-19 mortgage relief policies,” Broeksmit said. “The enhanced forbearance provisions will provide borrowers with the same options and allow mortgage servicers to streamline their offerings to provide relief for homeowners. We look forward to continuing to work with FHFA, the administration, and other stakeholders on ways to help consumers throughout this difficult time.”