FHA and HUD Announce Extended COVID-19 Mortgage Relief
The Department of Housing and Urban Development has announced an extension to coronavirus relief measures intended to help borrowers financially affected by COVID-19. On Monday, December 21, 2020, the FHA and HUD announced a two-month extension to its foreclosure and eviction moratorium.
The new expiration date for the moratorium is listed as February 28, 2021.
The FHA is also adding more time for FHA borrowers to request what the FHA calls an “initial COVID-19 forbearance” from their mortgage servicer to “defer or reduce their mortgage payments for up to six months, which can be extended for an additional six months. In addition, the FHA also “extended multiple temporary provisions for lenders and servicers to allow them to continue doing FHA business despite social distancing considerations.”
This is not the first time the agency has modified the expiration dates of COVID-19 mortgage relief measures; it’s actually the fourth such extension and is applicable for all FHA mortgages except for buildings that are considered abandoned or “legally vacant.”
FHA officials have gone on the record about this extension saying the measures “ensure American homeowners continue to have the critical relief and support they need to get back to financial stability.” An FHA mortgagee letter published on the HUD official site adds that the global pandemic has created economic hardship for literally millions of American homeowners.
“FHA will continue to assist borrowers who are struggling to regain their financial footing as a result of this pandemic. American homeowners should not be forced from their homes while they are seeking help,” said Assistant Secretary for Housing and Federal Housing Commissioner Dana Wade, who was quoted in the mortgagee letter.
The FHA and HUD have taken additional measures to facilities the FHA home loan process using social distancing measures meant to prevent further spread of the virus. The FHA and HUD have extended:
- Timeframes for providing an insurance endorsement on single family mortgages in forbearance through March 31, 2021.
- Temporary re-verification of employment guidance and exterior-only appraisal inspection option through February 28, 2021.
- Temporary provisions for verification of self-employment, rental income, and 203(k) Rehabilitation Mortgage escrow accounts through February 28, 2021.
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