The Department of Housing and Urban Development
(HUD) has extended the timeframe for several of the relief programs it put into
effect last spring through its Federal Housing Administration (FHA) to help lenders,
servicers, and homeowners cope with the COVID-19 crisis.

FHA’s eviction and foreclosure moratoriums have been extended for
an additional two months, through February 28, 2021.
These moratoriums prohibit
servicers from initiating or proceeding with foreclosure and
foreclosure-related eviction actions for FHA-insured single family forward and
reverse mortgages, except for those secured by legally vacant and abandoned
properties. This is the fourth time these moratoriums have been extended.   

The period to request an initial
COVID 19 forbearance plan has also been extended through the end of February.
Initial forbearances are for six months and can be extended for another six
months if necessary. 

FHA
encourages borrowers with FHA-insured mortgages to continue to make their
mortgage payments if they are able. Those who are struggling financially because
of the pandemic should call their mortgage servicer. There are several options
to assist borrowers to bring their mortgages current once the crisis ends. They
will not be required to bring their mortgages current with one lump-sum
payment.

The current announcement does not
contain any provisions for additional extensions for homeowners who are already
in a forbearance plan. The maximum 12-month timeframes for those borrowers will
begin expiring for those borrowers in March.

“COVID-19 has created hardships for
millions of Americans. FHA will continue to assist borrowers who are struggling
to regain their financial footing as a result of this pandemic,” Assistant
Secretary for Housing and Federal Housing Commissioner Dana Wade said. “American
homeowners should not be forced from their homes while they are seeking help.”

FHA also extended its temporary adjustments
to several underwriting requirements. The timeframe
for providing an insurance endorsement on single family mortgages in forbearance
is not March 31, 2021. Temporary provisions for verification of
self-employment, rental income, 203(k) Rehabilitation Mortgage Escrow accounts
and temporary reverification of employment guidance and exterior-only appraisals
were all extended through February 28, 2021. FHA said these were designed
to keep originations flowing
despite the difficulties imposed by social
distancing. 

By Jann Swanson , dated 2020-12-22 08:40:00

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Courtesy of Mortgage News Daily

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