If you’ve been following the news lately, you may have heard about the U.S. government’s recent extension of mortgage forbearance and foreclosure relief protections related to COVID-19. Below you’ll find some helpful information about what this legislation entails and how it may impact you.
The Recent Extensions
HUD/FHA, VA & USDA Loans
On February 16, 2021, the U.S. government—more specifically, the Biden administration along with the U.S. Department of Housing and Urban Development (HUD), the U.S. Department of Veterans Affairs (VA), and the U.S. Department of Agriculture (USDA)—announced that it would be extending and expanding the mortgage forbearance and foreclosure relief programs applicable to federally backed HUD/FHA, VA, and USDA loans (these protections were previously set to expire in March 2021). The terms of the new plan are as follows:
- The foreclosure moratorium has been extended through June 30, 2021.
- The mortgage forbearance enrollment window has been extended until June 30, 2021.
- Borrowers who entered mortgage forbearance on or before June 30, 2020, may receive up to six months of additional forbearance (in three-month increments).
Fannie Mae & Freddie Mac Loans
The U.S. Federal Housing Finance Agency (FHFA) has also announced some extensions that apply to mortgage loans backed by Fannie Mae and Freddie Mac:
- The foreclosure moratorium has been extended until June 30, 2021.
- Borrowers who were in a COVID-19 mortgage forbearance plan as of February 28, 2021, may be eligible for an additional three-month extension.
The American Rescue Plan
While the extensions discussed above apply only to certain federally backed mortgages, there is a new piece of legislation that could potentially benefit homeowners with private mortgages, as well. On March 11, 2021, President Biden signed the American Rescue Plan Act of 2021 into law. This $1.9 trillion economic stimulus bill is designed to support our country’s recovery from the COVID-19 pandemic and the resulting recession.
With regard to mortgage foreclosures, the American Rescue Plan provides $10 billion in funding for the Homeowner Assistance Fund. This fund will distribute money to the various state and local governments, which will in turn provide grants to homeowners to prevent them from defaulting on their mortgages and eventually foreclosing on their homes. Homeowners (including those with private mortgages) can use these grants for a number of purposes, such as paying for flood insurance premiums, utility bills, HOA fees, and whatever else is necessary to stay in their homes.
Foreclosure Defense Attorneys Proudly Serving the Tampa Bay Area
If you have questions about how the recent extensions will specifically affect you, you can turn to the skilled attorneys at The Lyons Law Group, P.A. We’re a full-service real estate law firm that’s been representing clients across Pasco and Hernando Counties since 2008. The experienced attorneys on our team are highly familiar with the rules relating to mortgage forbearance and the foreclosure moratorium, and they can provide you with the tailored advice you need to move forward.
To schedule a free consultation with one of the foreclosure defense attorneys at our firm, contact The Lyons Law Group, P.A. We have offices in New Port Richey and Spring Hill, and we would be happy to provide you with directions to whichever location is more convenient for you.