Tag Archives: Foreclosures

COVID-19: FHA Extends Eviction and Foreclosure Moratorium for Homeowners through 12-31-2020

Per HUD, earlier today, on August 28, 2020, the Federal Housing Administration (FHA) announced the 3rd extension of its foreclosure and eviction moratorium through December 31, 2020, for homeowners with FHA-insured single family mortgages covered under the Coronavirus Relief and Economic Security (CARES) Act.

This extension provides an additional 4 months of housing security to homeowners. With this 3rd extension, the FHA has now provided more than 9 months of foreclosure and eviction relief to FHA-insured homeowners

The FHA’s Single Family foreclosure and eviction moratorium has been in place since March 18, 2020, and continues to apply to homeowners with FHA-insured Title II Single Family forward and Home Equity Conversion (reverse) mortgages.

The moratorium requires that mortgage servicers:

1. Halt all new foreclosure actions and suspend all foreclosure actions currently in process for FHA-insured single family properties, excluding legally vacant or abandoned properties; and

2. Cease all evictions of persons from FHA-insured single family properties, excluding actions to evict occupants of legally vacant or abandoned properties.

The HUD press release suggested that homeowners with FHA-insured mortgages should continue to make their mortgage payments during the foreclosure and eviction moratorium if they are able to do so, or seek mortgage payment forbearance pursuant to the CARES Act from their mortgage servicer, if needed.

Pursuant to the CARES Act, the FHA requires mortgage servicers to:

1. Offer borrowers with FHA-insured mortgages delayed mortgage payment forbearance when the borrower requests it, with the option to extend the forbearance for up to a year.

2. The FHA does not require a lump sum payment at the end of the forbearance period.

3. Assess borrowers who receive COVID-19 forbearance for its special COVID-19 National Emergency Stand alone Partial Claim before the end of the forbearance period. The COVID-19 National Emergency Standalone Partial Claim puts all deferred mortgage payment amounts owed into a junior lien which is only repaid when the borrower sells the home, refinances the mortgage, or the mortgage is otherwise extinguished.

Duane Morris has created a COVID-19 Strategy Team to help organizations plan, respond to and address this fast-moving situation. Contact your Duane Morris attorney for more information. Prior Alerts on the topic are available on the team’s webpage.

If you have any questions about this post, please contact Brad A. Molotsky, Elizabeth Mincer or the attorney in the firm with whom you are regularly in contact.

Be well and stay safe.

COVID-19: PA Extends Eviction and Moratorium Protections through July 10th for Residential Transactions

Governor Tom Wolf was joined by Attorney General Josh Shapiro to announce that he signed an executive order that protects Pennsylvanians from foreclosures or evictions through July 10. The action builds on a Pennsylvania Supreme Court order which closed court eviction proceedings until May 11 and ensures no renter or homeowner will be removed from their home for 60 more days.

“At a time when people need to stay home to protect their heath, they should not have to worry about losing their homes,” said Governor Wolf. “Ensuring that people can remain in their homes will help them to better protect their loved ones. It gives families the comfort of knowing they will have a place to live while all of us work together to fight COVID-19 and prepare to move Pennsylvania forward.”

In almost all circumstances, renters and homeowners are required to continue making monthly payments.

The Wolf Administration provided recommendations last week to stem foreclosures, evictions and help people experiencing homelessness. The Department of Human Services activated the Commonwealth’s Sheltering Taskforce and is working with local and state partners to coordinate resources for people without housing. The Department of Community and Economic Development is also accepting applications for Emergency Solutions Grants to assist with the rapid rehousing of people experiencing homelessness, street outreach, homelessness prevention, and emergency shelter activities.

PHFA is also taking action to help homeowners and renters. The agency has stopped foreclosures and evictions and is offering forbearances with late fee waivers to homeowners with a PHFA mortgage who are experiencing a financial hardship because of COVID-19. PHFA also developed a list of renters’ rights and responsibilities to clarify the situation for apartment residents and is working with landlords and property managers to distribute it to renters. PHFA is also encouraging Low-Income Housing Tax Credit building managers to be flexible on rent payments and to waive late fees for tenants whose employment has been affected by the crisis. 

Duane Morris has created a COVID-19 Strategy Team to help organizations plan, respond to and address this fast-moving situation. Contact your Duane Morris attorney for more information. Prior Alerts on the topic are available on the team’s webpage.

For Further Information:

If you have any questions about this post, please contact Brad A. Molotsky, David Augustin or the attorney in the firm with whom you are regularly in contact.

Be well and stay safe!