As a result of the continued hardship from the COVID-19 pandemic, the Biden administration announced Tuesday an extension of a foreclosure moratorium through the end of June.
This means there would be no home foreclosures for federally backed mortgages until July. The window for enrolling in mortgage forbearance would be extended to June 30, and homeowners in need could potentially receive an additional six months of mortgage forbearance.
While Tuesday’s action affects homeowners rather than renters, there is a separate program that provides rental assistance.
The efforts to help both homeowners and renters are detailed below.
Homeowners
Tuesday’s announcement applies to homeowners with a federally backed mortgage who are having trouble making payments. These include mortgages from the Department of Housing and Urban Development, Department of Veterans Affairs and Department of Agriculture.
Earlier in the month, the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, announced an extension of its eviction moratorium until March 31 and an additional three months of forbearance for qualifying borrowers.
Together, the actions cover 70% of existing single-family home mortgages, according to The White House.
Mortgage forbearance is when your mortgage servicer (the entity that you make payments to) allows you to pause or reduce your mortgage payments for a limited time. For example, the FHFA payment deferral allows borrowers to repay missed payments at the time the home is sold, refinanced or at mortgage maturity.
For homeowners who don’t have a Fannie Mae, Freddie Mac, FHA, VA or USDA loan, there is discussion of relief in the new stimulus bill. Currently, the American Rescue Plan creates a Homeowners Assistance Fund that would provide $10 billion to help struggling homeowners catch up on mortgage payments and utilities.
If you are struggling to make your payment, reach out to your servicer as soon as possible to ask about setting up a forbearance program. Homeowners can visit ConsumerFinance.gov/Housing for more information about their relief options.
Renters
One in five renters is behind on rent, according to the Census Bureau’s Household Pulse Survey.
Fortunately, there is help for renters to meet their obligations. As part of Congress’ December stimulus package, Utah has received at least $200 million for rental assistance and has a rent relief program up and running for renters adversely affected by the pandemic.
The rent relief program helps renters who are unable to pay for rent and utilities because of a loss of income related to the pandemic. The assistance money — up to $2,000 a month for up to 12 months (or 15 months in certain circumstances) — can be used to pay rent, late fees and utilities (water, sewer, electrical, gas). Renters can also use the assistance to pay for past rent payments going back to March 13, 2020.
To qualify, renters must have a combined gross income at or below 80% of the area median income. Additionally, renters must show a risk of housing instability and must be party to a lease agreement.
Renters will apply through the housing agencies listed at RentRelief.Utah.gov. Information about the program is also available by calling 2-1-1.
Rent assistance will be paid directly to the landlord while utility assistance goes directly to utility companies.
The program is subject to change and no assistance will be approved after June 30, 2021. President Biden’s proposed COVID-19 relief package also aims to provide additional funding for rental assistance.
Whether you are a homeowner or a renter, if you are having trouble making your payments, there is help. Make sure to reach out immediately to learn more about your options.
To learn more about the latest housing news, contact a local Realtor. Find one at MyRealtorStory.com.