At-risk homeowners can now postpone mortgage payments (via forbearance) for 15 months. Foreclosure and REO-related eviction bans run until March 31.
WASHINGTON, D.C. – The Federal Housing Finance Agency (FHFA) announced that mortgages held by Fannie Mae and Freddie Mac have extended their moratoriums on single-family foreclosures and real estate owned (REO) evictions until March 31, 2021.
The foreclosure moratorium applies to single-family mortgages and only those backed by Fannie and Freddie. The REO eviction moratorium applies to properties they’ve acquired through foreclosure or deed-in-lieu of foreclosure transactions. The current moratoriums were set to expire on Feb. 28, 2021.
Mortgage borrowers with a loan backed by Fannie Mae or Freddie Mac may also be eligible for an additional forbearance extension of up to three months.
Under forbearance, homeowners financially harmed by the pandemic can postpone payments that can then be paid at the time the home is sold, refinanced or at mortgage maturity. Foreclosures aren’t expected to pick up significantly until forbearance ends, and the government hopes most homeowners in forbearance will be able to return to work before then.
Eligibility for the forbearance extension is limited to borrowers who are already on a COVID-19 forbearance plan as of Feb. 28, 2021, and FHFA says other limits may apply.
With the just announced extension, the COVID-19 Payment Deferral allows borrowers with a Fannie or Freddie-backed mortgage to cover up to 15 months of missed payments.
FHFA projects that the program will cost Fannie and Freddie $1.5 to $2 billion for the COVID-19 foreclosure moratorium and its extension.
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