The StoneHill Group continually monitors the mortgage industry for changes that impact our clients. Here are the most recent Agency updates.
Origination Agency Updates Related to COVID-19
November 17, 2020
Fannie Mae
LL-2020-04: Impact of COVID-19 on Appraisals (03/23/20 Updated 11/13/20)
Temporary appraisal requirement flexibilities – Extension
Effective immediately, we are allowing temporary flexibilities to our appraisal inspection and reporting requirements. As described below, we will accept an alternative to the traditional appraisal required under Selling Guide Chapter B4-1, Appraisal Requirements, when an interior inspection is not feasible because of COVID-19 concerns. We will allow either a desktop appraisal or an exterior-only inspection appraisal in lieu of the interior and exterior inspection appraisal (i.e., traditional appraisal).
If a traditional appraisal is not obtained and there is insufficient information about the property for an appraiser to be able to complete an appraisal assignment with a desktop or exterior-only inspection appraisal, the loan will not be eligible for delivery to us.
Desktop appraisals
For purchase money transactions when an interior and exterior appraisal is not available, lenders are encouraged to obtain a desktop appraisal rather than an exterior-only appraisal.
The minimum scope of work for a desktop appraisal does not include an inspection of the subject property or comparable sales. The appraiser relies on public records, multiple listing service (MLS) information, and other third-party data sources to identify the property characteristics.
When a desktop appraisal is performed, reported on Form 1004 or Form 1073, and submitted to us through the Uniform Collateral Data Portal® (UCDP®), the appraisal will be scored by Collateral Underwriter® (CU®). All loans with a CU risk score of 2.5 or less will receive value representation and warranty relief under Day 1 Certainty. With desktop appraisals, lenders will have the added risk management and efficiency benefit of being able to use CU to aid in the appraisal review process.
Exhibits for desktop appraisals
Each desktop appraisal report must include the following exhibits:
- a location map indicating the location of the subject and comparables, and
- photographs of the subject property. We recognize that it may be challenging in some instances to obtain photographs; however, it is expected that the appraiser utilizes available means to obtain relevant pictures of the subject property.
Exterior-only inspection appraisals
An exterior-only inspection appraisal may be obtained in lieu of an interior and exterior inspection appraisal for the following transactions:
- purchase money loans
- limited cash-out refinances where the loan being refinanced is owned by Fannie Mae
Lenders will not receive value representation and warranty relief under Day 1 Certainty® for loans with exterior-only appraisals.
Exhibits for exterior-only inspection appraisals
Lenders are reminded that the following exhibits to the appraisal report are required for an exterior-only inspection appraisal:
- a street map that shows the location of the subject property and of all comparable sales that the appraiser used;
- clear, descriptive photographs (either in black and white or color) that show the front of the subject property, and that are appropriately identified (photographs must be originals that are produced either by photography or electronic imaging); and
- any other data–as an attachment or addendum to the appraisal report form–that are necessary to provide an adequately supported opinion of market value.
Fannie Mae Updates LL-2020-03: Impact of COVID-19 on Originations (03/23/20 Updated 11/13/20)
We are extending the temporary flexibilities related to verbal verifications of employment to loans with application dates on or before Dec. 31, 2020 from Nov. 30, 2020. (The dates have been updated in the applicable sections below.) All other policies remain effective until further notice.
Requirements for borrowers using self-employment income to qualify UPDATED Nov. 13
Effective: The updated requirement to obtain and review three business depository account statements (increased from two statements) with an unaudited profit and loss statement is effective for loan applications dated on and after Dec. 14, 2020. Lenders are encouraged to apply this requirement to existing loans in process, but are not required to. All policies are effective until further notice.
Income Analysis
Self-employment income is variable in nature and generally subject to changing market and economic conditions. Whether a business is impacted by an adverse event, such as COVID-19, and the extent to which business earnings are impacted can depend on the nature of the business or the demand for products or services offered by the business. Income from a business that has been negatively impacted by changing conditions is not necessarily ineligible for use in qualifying the borrower. However, the lender is required to determine if the borrower’s income is stable and has a reasonable expectation of continuance.
Due to the pandemic’s continuing impact on businesses throughout the country, lenders are now required to obtain the following additional documentation to support the decision that the self-employment income meets our requirements:
- an audited year-to-date profit and loss statement reporting business revenue, expenses, and net income up to and including the most recent month preceding the loan application date; or
- an unaudited year-to-date profit and loss statement signed by the borrower reporting business revenue, expenses, and net income up to and including the most recent month preceding the loan application date, and three business depository account(s) statements no older than the latest three months represented on the year-to-date profit and loss statement.
For example, the business depository account statements can be no older than Aug, Sep, Oct. for a year-to-date profit and loss statement dated through Oct. 31.
- The lender must review the three most recent depository account statements to support the level of business revenue reported in the current year-to-date profit and loss statement. Otherwise, the lender must obtain additional statements or other documentation to support the on-going nature of business revenue reported in the current year-to-date profit and loss statement.
NOTE: The year-to-date profit and loss statement must be no older than 60 days old as of the note date consistent with current Age of Documentation
Lenders must review the profit and loss statement, and business depository accounts if required, and other relevant factors to determine the extent to which a business has been impacted by COVID-19. The lender can use the following guidance when performing the assessment of business operations and stability and must complete the business income assessment based on the minimum additional documentation above.
Business Income Calculation Adjustment
When the lender determines current year net business income has been impacted by the COVID-19 pandemic and is
- less than the historical monthly income calculated using Form 1084, but is stable at its current level, the lender must reduce the amount of qualifying income calculated using Form 1084 to no more than the current level of stable income as determined by the lender (see Business Income above).
- more than the historical income calculated using Form 1084, the lender must use no more than the currently stable level of income calculated using Form 1084 to qualify the borrower.
In all cases, qualifying income must be supported by documentation, including any supplemental documentation obtained by the lender.
Business Assets
We are clarifying that proceeds from the Small Business Administration PPP or any other similar COVID-19 related loans or grants are not considered business assets. Refer to B3-4.2-02, Depository Accounts for details.
Temporary eligibility requirements for purchase and refinance transactions
Effective: Lenders may immediately apply these policies to loans in process and must apply them to loans with application dates on or after Jun. 2, 2020. These policies will be effective until further notice.
In response to lender feedback, we are addressing eligibility requirements for borrowers impacted by the COVID-19 pandemic. With this update we are providing eligibility guidelines for purchase and refinance transactions.
Lenders must continue to review the borrower’s credit report to determine the status of all mortgage loans. In addition to reviewing the credit report, the lender must also apply due diligence for each mortgage loan on which the borrower is obligated, including co-signed mortgage loans and mortgage loans not related to the subject transaction, to determine whether the payments are current as of the note date of the new transaction. For the purposes of these requirements, “current” means the borrower has made all mortgage payments due in the month prior to the note date of the new loan transaction by no later than the last business day of that month. Examples of acceptable additional due diligence methods to document the loan file include:
- a loan payment history from the servicer or third-party verification service,
- a payoff statement (for mortgages being refinanced),
- the latest mortgage account statement from the borrower, and
- a verification of mortgage.
We are not considering payments missed during the time of a COVID-19-related forbearance that have been resolved to be historical delinquencies for purposes of our excessive mortgage delinquency policy as outlined in B3-5.3-03, Previous Mortgage Payment History. This flexibility does not apply to high LTV refinance loans, which must continue to meet the payment history requirements in B5-7-02, High LTV Refinance Underwriting, Documentation, and Collateral Requirements for the New Loan.
Unemployment benefits as qualifying income
We are reminding lenders of our current policy in the Selling Guide pertaining to the use of unemployment benefits. Per B3-3.1-09, Other Sources of Income, unemployment benefits cannot be used to qualify a borrower unless they are clearly associated with seasonal employment that is reported on the borrower’s signed federal income tax returns. We recognize that many unemployed and furloughed individuals are eligible for unemployment benefits under the CARES Act; however, unemployment compensation is short-term in nature and is therefore not a reliable and predictable source of income for borrowers who are not established seasonal workers.
Furloughed borrowers
The COVID-19 pandemic has resulted in an increase in furloughed employees. A furlough is a suspension from active employment that does not typically guarantee restoration of an employee’s position when the furlough period ends. Until furloughed employees actually return to work, they are unable to provide evidence of a stable and reliable flow of employment-related income and are therefore ineligible under our Temporary Leave Income policy in B3-3.1-09, Other Sources of Income.
USDA Updated and Reminders
October 29, 2020
Extension of Temporary Exceptions: The temporary exceptions originally issued on March 27, 2020, pertaining to appraisals, repair inspections, and income verifications for the Single Family Housing Guaranteed Loan Program (SFHGLP) due to the COVID-19 pandemic have been extended until December 31, 2020 and apply to the requirements in the program handbook HB-1-3555 for new loans, described below.
Residential Appraisal Reports Existing Dwelling
For purchase and non-streamlined refinance transactions, when an appraiser is unable to complete an interior inspection of an existing dwelling due to concerns associated with the COVID-19 pandemic, an Exterior-Only Inspection Residential Appraisal Report, (FHLMC 2055/FNMA 2055) will be accepted. In such cases, appraisers are not required to certify that the property meets HUD HB 4000.1 standards. The appraisal must be completed in accordance with the Uniform Standards of Professional Practice (USPAP) and the Uniform Appraisal Dataset (UAD).
This exception is not applicable to existing manufactured housing pilot program, new construction properties, or construction to permanent loans. As a reminder, appraisals are not required for streamlined and streamlined-assist refinance transactions.
Repair Inspections Existing Dwelling
Loans for which a completion certification is not available due to issues related to the COVID-19 pandemic, a letter signed by the borrower confirming that the work was completed is permitted. Lenders must also provide further evidence of completion, which may include photographs of the completed work, paid invoices indicating completion, occupancy permits, or other substantially similar documentation. All completion documentation must be retained in the loan file.
This exception is not applicable to rehabilitation and repair loans noted in section 12.28 of HB-1-3555
Verbal Verification of Employment
Lenders should use due diligence in obtaining the most recent income documentation to verify the borrower’s repayment ability prior to closing. When the lender is unable to obtain a Verbal Verification of Employment (VVOE) within 10 business days of loan closing due to a temporary closure of the borrower’s employment, alternatives should be explored. For example, email correspondence with the borrower’s employer is an acceptable alternative to a VVOE. If the lender is unable to obtain a VVOE or acceptable alternative, the requirement will be waived when the borrower has a minimum of 2 months cash reserves.
In the case of a reduction of income, the borrower’s reduced income must be sufficient to support the new loan payment and other non-housing obligations. Borrower’s with no income or those receiving unemployment benefits at the time of closing are not eligible for SFHGLP loans regardless of available cash reserves.
Questions regarding program policy and this announcement may be directed to the National Office Division at sfhgld.program@usda.gov or (202) 720-1452.
Servicing Agency Updates Related to COVID-19
November 18, 2020
Fannie Mae
LL-2020-07: COVID-19 Payment Deferral (05/13/20 Updated 11/18/20)
The servicer must not require a complete Borrower Response Package (BRP) to evaluate the borrower for a COVID-19 payment deferral if the eligibility criteria are satisfied.
In order to be eligible for a COVID-19 payment deferral, the criteria reflected below must be met.
The borrower must
- be on a COVID-19 related forbearance plan, or
- have experienced a financial hardship resulting from COVID-19 (for example, unemployment, reduction in regular work hours, or illness of a borrower/co-borrower or dependent family member) that has impacted their ability to make their full monthly contractual payment.
NOTE: The servicer is not required to obtain documentation of the borrower’s hardship.
The servicer must achieve Quality Right Party Contact (QRPC) to
- determine the reason for the delinquency and whether it is temporary or permanent in nature;
- determine whether or not the borrower has the ability to repay the mortgage debt;
- educate the borrower on the availability of workout options, as appropriate; and
- obtain a commitment from the borrower to resolve the delinquency.
Additionally, the servicer must confirm that the borrower
- has resolved the hardship,
- is able to continue making the full monthly contractual payment, and
- is unable to reinstate the mortgage loan or afford a repayment plan to cure the delinquency.
NOTE: If the mortgage loan was previously modified pursuant to a Fannie Mae Home Affordable Modification Program (HAMP) modification under which the borrower remains in “good standing,” and the borrower was on a COVID-19 related forbearance plan immediately preceding the COVID-19 payment deferral or had a COVID-19 related hardship immediately preceding the COVID-19 payment deferral, then the borrower will remain eligible to receive any future HAMP “pay for performance” incentives upon acceptance of the COVID-19 payment deferral.
the mortgage loan must be a conventional first lien mortgage loan, and may be a fixed-rate, a step-rate, or an ARM.
NOTE: The property securing the mortgage loan may be vacant or condemned.
The mortgage loan must
- have been current or less than two months delinquent as of Mar. 1, 2020 the effective date of the National Emergency declaration related to COVID-19; and
- be equal to or greater than one-month delinquent but less than or equal to 12 months delinquent as of the date of evaluation.
NOTE: If a borrower’s hardship is related to COVID-19 but he or she was two or more months delinquent as of the effective date of the National Emergency declaration, and the servicer determines the borrower can maintain his or her full monthly contractual payment, then the servicer must submit a request for a COVID-19 payment deferral through Fannie Mae’s servicing solutions system for review and obtain prior approval from Fannie Mae.
NOTE: If a mortgage loan was originated after Mar. 1, 2020, the effective date of the National Emergency Declaration related to COVID-19, and otherwise meets all criteria to receive a COVID-19 payment deferral, then the servicer must evaluate the borrower for a COVID-19 payment deferral and, if eligible, offer the COVID-19 payment deferral.
The mortgage loan must not have previously received a COVID-19 payment deferral.
NOTE: The mortgage loan may have previously received a non-COVID-19 payment deferral.
The mortgage loan must not be subject to
- a recourse or indemnification arrangement under which Fannie Mae purchased or securitized the mortgage loan or that was imposed by Fannie Mae after the mortgage loan was purchased or securitized,
- an approved liquidation workout option,
- an active and performing repayment plan or other non-COVID-19 related forbearance plan,
- a current offer for another retention workout option, or
- an active and performing mortgage loan modification Trial Period Plan.
Determining eligibility for a COVID-19 payment deferral for a Texas Section 50(a)(6) loan
A Texas Section 50(a)(6) loan is eligible for a COVID-19 payment deferral if
- the requirements described in Determining eligibility for a COVID-19 payment deferralare satisfied, and
- the application of a COVID-19 payment deferral to the mortgage loan complies with applicable law.
If the servicer receives notice from the borrower that a COVID-19 payment deferral fails to comply with Texas Section 50(a)(6) requirements, the servicer must immediately, but no later than seven business days after receipt, take the actions listed as follows.
The servicer must…
Inform our Legal department by submitting a Non-Routine Litigation Form (Form 20) and include the borrower notice in its submission.
Collaborate with us on the appropriate response, including any cure that may be necessary, within the 60-day time frame provided by the requirements of Texas Section 50(a)(6).
Completing a COVID-19 payment deferral
The servicer must complete (i.e., submit the case via Fannie Mae’s servicing solutions system) a COVID-19 payment deferral in the same month in which it determines the borrower is eligible.
The servicer is authorized to use an additional month to allow for sufficient processing time (a “processing month”) to complete a COVID-19 payment deferral. The servicer must treat all borrowers equally in applying the processing month, as evidenced by a written policy.
NOTE: If the mortgage loan is 12 months delinquent as of the date of evaluation, the borrower must make his or her full monthly contractual payment during the processing month. In this circumstance, the servicer must complete the COVID-19 payment deferral within the processing month after receipt of the borrower’s full monthly contractual payment due during that month.
The servicer must send the COVID-19 payment deferral agreement, or equivalent, to the borrower no later than five days after the completion of the COVID-19 payment deferral.
While use of the COVID-19 payment deferral agreement is optional, it reflects the minimum level of information that the servicer must communicate and illustrates a level of specificity that complies with the requirements of the Servicing Guide. Also, the servicer must ensure the COVID-19 payment deferral agreement complies with applicable law.
NOTE: If the servicer determines the borrower’s signature is required on the COVID-19 payment deferral agreement, it must receive the executed agreement prior to completing the COVID-19 payment deferral.
The servicer’s application of a COVID-19 payment deferral to the mortgage loan must not impair our first lien position or enforceability against the borrower(s) in accordance with its terms.
The servicer must record the COVID-19 payment deferral agreement if the servicer determines that recordation is required to comply with law and ensure that the mortgage loan retains its first lien position. The servicer must obtain a title endorsement or similar title insurance product issued by a title insurance company if the COVID-19 payment deferral agreement will be recorded.
Soliciting the borrower for a post-forbearance COVID-19 payment deferral
If the servicer is unable to establish QRPC as described in Determining eligibility for a COVID-19 payment deferral with a borrower on a COVID-19 related forbearance plan and the borrower is otherwise eligible for a COVID-19 payment deferral, the servicer must send an offer for a COVID-19 payment deferral within 15 days after expiration of the forbearance plan.
The servicer must solicit the borrower using the Payment Deferral Post COVID-19 Forbearance Solicitation Cover Letter with the COVID-19 payment deferral agreement or the equivalent, making any appropriate changes to comply with applicable law.
While use of the Payment Deferral Post COVID-19 Forbearance Solicitation Cover Letter and COVID-19 payment deferral agreement is optional, it reflects the minimum level of information that the servicer must communicate and illustrates a level of specificity that complies with the requirements of the Servicing Guide.
The Payment Deferral Post COVID-19 Forbearance Solicitation Cover Letter must include language that additional forbearance may be available if the borrower’s hardship is not resolved, and that a mortgage loan modification may be available if the borrower needs payment relief.
The servicer must include instruction on how to accept the offer in the COVID-19 payment deferral agreement. The servicer is authorized to consider the following as acceptance by the borrower, subject to applicable law:
- the borrower contacting the servicer directly in accordance with any acceptable outreach and communication method,
- the borrower returning an executed COVID-19 payment deferral agreement, or
- any other method evidencing the borrower’s acceptance as determined by the servicer.
For additional information related to Payment Deferrals, please read the Fannie Mae LL as noted.
FHA
FHA INFO #20-75
Updates to the Effective Date of Initial COVID-19 Forbearance Requests and Home Equity Conversion Mortgage (HECM) Extension Period
Today, the Federal Housing Administration (FHA) published Mortgagee Letter (ML) 2020-34, Update to the Date for Approving a COVID-19 Forbearance or COVID-19 Home Equity Conversion Mortgage (HECM) Extension. This ML extends the date from October 30, 2020 to December 31, 2020, for when a borrower may request an initial six-month COVID-19 forbearance or make the initial request for an extension to a HECM due and payable period. This guidance was first announced in ML 2020-06 on April 1, 2020.
FHA recognizes the continuing nature of the COVID-19 National Emergency and implemented the December 31, 2020, date to provide impacted borrowers with additional time to request a COVID-19 forbearance or HECM extension. The maximum timeframe for a COVID-19 Forbearance is still 12 months.
For further guidance, servicers should reference the COVID-19 Forbearance established in ML 2020-06 and ML 2020-22. Servicers are encouraged to read those MLs in their entirety as the requirements, aside from the revised deadlines, remain unchanged.
- View Mortgagee Letter ML 2020-06, ML 2020-22, and all other archived Mortgagee Letters at: https://link.edgepilot.com/s/47355aca/Qzrz1XRc_kWiUXJepZmEEQ?u=https://www.hud.gov/program_offices/administration/hudclips/letters/mortgagee
- View the FHA COVID-19 Q&As on the Single Family main page on hud.gov at: https://link.edgepilot.com/s/62697ff3/UzO3tBerCES00h2l9RsObQ?u=https://www.hud.gov/program_offices/housing/sfh
- Access the Loss Mitigation Services for FHA Homeowners consumer page on hud.gov at: https://link.edgepilot.com/s/c93da705/QwkkogJZb0ejyC3m-tSLgQ?u=https://www.hud.gov/program_offices/housing/sfh/nsc/lossmit
September 9, 2020
Fannie Mae
Fannie Mae Updates LL-2020-07: COVID-19 Payment Deferral
Updates Lender Letter 2020-07 with additional guidance regarding COVID-19 Payment Deferral
The following content was published May 13, 2020, Updated May 27, 2020, Jun. 10, 2020, Jul. 15, 2020, Aug. 27, 2020
Determining eligibility for a COVID-19 payment deferral UPDATED June 10, 2020
The servicer must not require a complete Borrower Response Package (BRP) to evaluate the borrower for a COVID-19 payment deferral if the eligibility criteria are satisfied.
In order to be eligible for a COVID-19 payment deferral, the following criteria must be met:
The borrower must
- be on a COVID-19 related forbearance plan, or
- have experienced a financial hardship resulting from COVID-19 (for example, unemployment, reduction in regular work hours, or illness of a borrower/co-borrower or dependent family member) that has impacted their ability to make their full monthly contractual payment.
NOTE: The servicer is not required to obtain documentation of the borrower’s hardship.
The servicer must achieve Quality Right Party Contact (QRPC) to
- determine the reason for the delinquency and whether it is temporary or permanent in nature;
- determine whether or not the borrower has the ability to repay the mortgage debt;
- educate the borrower on the availability of workout options, as appropriate; and
- obtain a commitment from the borrower to resolve the delinquency.
Additionally, the servicer must confirm that the borrower
- has resolved the hardship,
- is able to continue making the full monthly contractual payment, and
- is unable to reinstate the mortgage loan or afford a repayment plan to cure the delinquency.
NOTE: If the mortgage loan was previously modified pursuant to a Fannie Mae Home Affordable Modification Program (HAMP) modification under which the borrower remains in “good standing,” then the mortgage loan will not lose good standing and the borrower will not lose any “pay for performance” incentives in the following circumstances:
- the borrower was on a COVID-19 related forbearance plan immediately preceding the COVID-19 payment deferral, or
- the borrower has a COVID-19 related hardship and the mortgage loan is less than three months delinquent.
For full details around the updates, please refer to LL 2020-07
Freddie Mac
Freddie Mac Announces Guide Bulletin 2020-34 (COVID-19 Foreclosure Moratorium Extension and Disaster Forbearance Updates)
This Bulletin announces an extension of the COVID-19 foreclosure moratorium and updates to Disaster forbearance for Eligible Disasters.
SUBJECT: COVID-19 FORECLOSURE MORATORIUM EXTENSION AND DISASTER FORBEARANCE UPDATES
This Bulletin announces:
- An extension of the COVID-19 foreclosure moratorium
- Updates to Disaster forbearance for Eligible Disasters
EFFECTIVE DATE
All of the changes announced in this Bulletin are effective immediately unless otherwise noted.
EXTENSION OF THE COVID-19 FORECLOSURE MORATORIUM
We are extending the foreclosure moratorium announced in Bulletins 2020-4, 2020-10, 2020-16 and 2020-25. Servicers must suspend all foreclosure actions, including foreclosure sales, through December 31, 2020. This includes initiation of any judicial or non-judicial foreclosure process, move for foreclosure judgment or order of sale. This foreclosure suspension does not apply to Mortgages on properties that have been determined to be vacant or abandoned.
DISASTER FORBEARANCE
In the event a disaster strikes, it is important that Servicers be considerate of the Borrower’s circumstances and work to obtain quality right party contact (QRPC) with the Borrower as soon as possible. However, we are aware that achieving timely QRPC is not always possible in disaster situations; therefore, in circumstances where the Servicer has not yet achieved QRPC and believes that the Borrower’s hardship is the result of an Eligible Disaster, the Servicer may place a Borrower who becomes 31 or more days delinquent after being impacted by an Eligible Disaster in a forbearance plan for up to 90 days. Servicers must obtain QRPC to approve forbearance for a Borrower who was 31 or more days delinquent at the time of impact due to an Eligible Disaster. We will update Guide Section 8404.4 in a future Bulletin to reflect this change.
FHA
FHA Announces Extension of Foreclosure and Eviction Moratorium in Connection with the Presidentially-Declared COVID-19 National Emergency
Announces an extension to the foreclosure and eviction moratorium originally issued in ML 2020-4, extended in ML 2020-13, and further extended in ML 2020-19 for borrowers with FHA-insured Single Family mortgages covered under the Coronavirus Aid, Relief, and Economic Security (CARES) Act for an additional period through December 31, 2020.
Purpose
The purpose of this Mortgagee Letter (ML) is to inform mortgagees of an extension to the foreclosure and eviction moratorium originally issued in ML 2020-4, extended in ML 2020-13, and further extended in ML 2020-19 for borrowers with FHA-insured Single Family mortgages covered under the Coronavirus Aid, Relief, and Economic Security (CARES) Act for an additional period through December 31, 2020.
Effective Date
The extension of the moratorium announced in this ML is effective immediately upon the expiration of the moratorium announced in ML 2020-19 for all FHA-insured mortgages except for FHA-insured mortgages secured by vacant or abandoned properties.
Moratorium on Foreclosures and Evictions and Extension of Deadlines
FHA-insured Single Family mortgages, excluding vacant or abandoned properties, are subject to an extension to the moratorium on foreclosure through December 31, 2020. The moratorium applies to the initiation of foreclosures and to foreclosures in process.
Separate from any eviction moratorium that was applicable to lessors under the CARES Act, evictions of persons from properties securing FHA-insured Single Family mortgages, excluding actions to evict occupants of legally vacant or abandoned properties, are also suspended through December 31, 2020.
Deadlines for the first legal action and reasonable diligence timelines are extended by 90 days from the date of expiration of this moratorium for FHA- insured Single Family mortgages, except for FHA-insured mortgages secured by vacant or abandoned properties.
VA
VA Extends Foreclosure Moratorium for Borrowers Affected by COVID-19
Extends foreclosure moratorium for borrowers with Federally backed mortgage loans who are experiencing financial hardship due to the COVID-19 national emergency.
Moratorium on Foreclosure. The CARES Act prohibited loan servicers from initiating any judicial or non-judicial foreclosure process for the 60-day period beginning March 18, 2020. Department of Veterans Affairs (VA) then extended the foreclosure moratorium through August 31, 2020. Per Executive Order 13945, Section 2, of August 8, 2020, it is the policy of the United States to minimize, to the greatest extent possible, residential evictions and foreclosures during the ongoing COVID–19 national emergency. In light of the ongoing COVID-19 national emergency and its impact on Veteran borrowers, properties secured by VA-guaranteed loans are subject to a moratorium on foreclosure through December 31, 2020. The moratorium applies to the initiation of foreclosures, and to the completion of foreclosures in process.
