The Federal Housing Finance Agency (FHFA) has announced that borrowers carrying mortgages backed by Fannie Mae and Freddie Mac may be eligible for an additional forbearance extension of up to three months.
Previously, the maximum term for such a forbearance period under the CARES Act was 12 months, so the new extension lengthens the maximum to 15. Eligibility for the extension is limited to borrowers who are on a COVID-19 forbearance plan as of Feb. 28, 2021, and other limits may apply, according to a statement from the FHFA.
Additionally, the FHFA announced that the COVID-19 Payment Deferral program for borrowers of loans backed by the government-sponsored enterprises (GSEs) can now cover up to 15 months of missed payments. The agency also again extended the moratoria on both single-family foreclosures and real estate owned (REO) evictions for GSE-backed properties, moving those expiration dates to March 31. They were set to end at the end of February; the new extension marks the sixth time the FHFA has moved the moratoria’s end since they were put in place last year.
“To keep families in their home during the pandemic, FHFA is allowing borrowers to be in COVID-19 forbearance for up to 15 months and extending the Enterprises’ foreclosure and eviction extension,” said FHFA Director Mark Calabria in a short statement.
The moratorium on foreclosures applies to single-family mortgages backed by the two government-sponsored enterprises (GSEs). The eviction moratorium applies to properties that have been acquired by the GSEs via foreclosure or deed-in-lieu foreclosure.
Currently, FHFA projects that the GSEs will bear expenses of approximately $1.5 to $2 billion due to the ongoing COVID-19 foreclosure moratorium and its extension.