Coronavirus Mortgage Assistance for Homeowners

February 13, 2021

Good news! Coronavirus Mortgage Assistance is available to homeowners.

UPDATE: FHFA extended foreclosure and REO eviction moratoriums and COVID forbearance period. Foreclosure moratorium continues until June 30, 2021. The eviction moratorium has been extended through March 31, 2021. COVID forbearance can now cover 15 months of payments.

The Consumer Financial Protection Bureau (CFPB), Federal Housing Finance Agency (FHFA) , and U.S. Department of Housing and Urban Development (HUD) are working together to help homeowners during the coronavirus pandemic.

This article covers:

What is forbearance?
How does the CARES Act protect you?
Are you eligible for Coronavirus Mortgage Assistance?
Help for borrowers with Fannie Mae or Freddie Mac loans
Assistance for borrowers with FHA-backed loans
Mortgage assistance for borrowers with VA-backed loans
How to get more help
Once you receive assistance: Next steps

What is Forbearance?

Forbearance is when your mortgage servicer or lender allows you temporarily suspend or reduce your mortgage payments.

Forbearance doesn’t mean your payments are forgiven or erased. You are still required to repay any missed or reduced payments in the future.

Make sure you understand how the forbearance will be repaid. There are different options, depending on the type of your loan.

For more information, consult the CFPB Forbearance Guide.

CARES Act relief for all federally- and GSE-backed mortgages

The CARES Act provides many homeowners with the right to have all mortgage payments completely paused for a period of time.

Under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, there are two protections for homeowners with federally- and GSE-backed mortgages:

First, your lender or loan servicer may not foreclose on you. Specifically, the CARES Act prohibits lenders and servicers from beginning a judicial or non-judicial foreclosure against you, or from finalizing a foreclosure judgment or sale, during this period of time.
Second, if you experience financial hardship due to the coronavirus pandemic, you have a right to request a forbearance . There will be no additional fees, penalties or additional interest (beyond scheduled amounts) added to your account. You do not need to submit additional documentation to qualify. You must simply claim to have a pandemic-related financial hardship.

During a forbearance under the CARES Act, your mortgage will continue to accumulate interest, but not late fees or other penalties. Watch a video about forbearance from the CFPB.

CARES Act – forbearance periods

Forbearance in the CARES Act has two periods: an initial period and an additional period.

For the initial period, notify your mortgage servicer that you are financially affected by the COVID-19 emergency. You may request up to 180 days of forbearance. Please note: you don’t have to use the entire forbearance period if you can resume payments sooner.

For the additional period, notify your mortgage servicer that you are still financially affected by the COVID-19 emergency. You may request up to 180 additional days of forbearance. Remember: you don’t have to use the entire period of forbearance if you can resume payments sooner.

Check Your Eligibility for Coronavirus Mortgage Assistance

To be eligible for protections under the CARES Act, your mortgage must be federally insured, guaranteed, owned, or otherwise backed or funded by one of the federal agencies or Government Sponsored Entities (GSEs) listed below. Most mortgages are federally or GSE-backed.

Finally, even if you don’t have a federally or GSE-backed mortgage, you still may have options. Check with your mortgage loan servicer or with your state.

Find out who services your mortgage

Only homeowners with mortgages owned by Fannie Mae or Freddie Mac are eligible for certain plans. To see if your home’s loan is owned by either company, check both the Fannie Mae loan lookup tool and the Freddie Mac loan lookup tool.

In addition, you can look up your mortgage servicer by searching the Mortgage Electronic Registration Systems (MERS) website.

You can also check the CFPB website or more information.

Fannie Mae and Freddie Mac – Coronavirus Mortgage Assistance

To see if your home’s loan is owned by either company, check both the Fannie Mae loan lookup tool and the Freddie Mac loan lookup tool.

If you have a Fannie Mae or Freddie Mac loan, you can now request payment deferrals as early as July 1. Any missed payments can be due at the end of the loan’s term, without any penalty or extra interest.

As soon as you are able to resume their normal monthly payments, you can reinstate your mortgage. You will then enter a payment deferral program, making up their missed payments years, or even decades, down the road when you sell or refinance your home.

Fannie Mae explains the program: “Homeowners can resume their regular monthly mortgage payment after up to 12 months of missed payments, and the missed payments are deferred—or moved—to the end of the loan term. This option is for homeowners who have completed a COVID-19 related forbearance plan and are able to continue making their full monthly contractual payment, but cannot afford full reinstatement or a repayment plan to bring their mortgage loan current.”

Servicers may have scripts that they use when they talk to you. You can review scripts from Fannie Mae and Freddie Mac , to help you get a sense of what to expect.

Consult the CFPB website for more information about requesting forbearance.

FHA Loan Program – Coronavirus Mortgage Assistance

If you have an FHA loan, consult the HUD website.

VA Loan Program – Coronavirus Mortgage Assistance

If you have a VA loan: https://benefits.va.gov/homeloans/cares-act-frequently-asked-questions.asp

The CARES Act provides multiple protections on your VA-guaranteed loan if you experience financial hardship directly or indirectly caused by COVID-19. These protections include:

A defined forbearance period of up to 180 days, with the possibility for extending it for another 180 days
A foreclosure and eviction moratorium for 60 days starting March 18, 2020
Instructions on how mortgage servicers are to report to the credit agencies. For example, borrowers who have requested the COVID-19 Forbearance option are not delinquent for purposes of credit reporting.

In addition, VA allows the missed payments to become due at the end of the loan with the last payment. In such cases, VA requires that amount to be non-interest bearing. You can pay toward the deferred amount over the life of the loan. As a result, this will reduce the amount due at the end of the loan. On the other hand, you can choose to pay the deferred amount at the end of the loan.

Find More Help

Check the CFPB website regarding Coronavirus Mortgage Relief.

Additionally, for help in exploring your options, you reach out to a housing counselor. Use the CFPB’s “Find a Counselor” tool to get a list of counseling agencies approved by the Department of Housing and Urban Development (HUD). You can also call the HOPE™ Hotline, open 24 hours a day, seven days a week, at (888) 995-HOPE (4673).

Finally you can also consult CFPB Homeowner’s Guide to Success.