USDA Announces Biden Administration Announces Foreclosure Moratorium and Mortgage Suspension Deadline Extension That Will Relieve Rural Residents
USDA Extends Moratorium on Evictions and Foreclosure Until March 31, 2021, Provides Additional Advice for COVID-19 Affected Loan Service
January 21, 2021 – WASHINGTON – In one of his first acts in office, President Joe Biden called on federal agencies to extend eviction and foreclosure moratoria for millions of Americans. In response, The U.S. Department of Agriculture has announced an extension of the eviction and foreclosure moratoriums on USDA Direct and Guaranteed Single-Family Housing Loans (SFHDLP and SFHGLP) until March 31, 2021. The actions announced today hui will bring relief to residents of rural America who have home loans through USDA.
The USDA acknowledges that the COVID-19 pandemic has triggered an almost unprecedented housing affordability crisis in the United States. Today, 1 in 10 homeowners with a mortgage are behind on payments. In addition to the actions taken, the Biden administration looks forward to working with Congress to take more robust and aggressive action to bring further relief to families and people in America affected by the pandemic.
Visit www.rd.usda.gov/coronavirus for more information on USDA Rural Development for COVID-19 relief efforts, extended application deadlines, and more. USDA Rural Development will keep our clients, partners and stakeholders continually updated as additional steps are taken to bring relief and development to rural America.
Extension of the foreclosure moratorium:
Actions announced today extend the foreclosure and eviction moratorium announced by the USDA, the Single Family Home Direct Loan Program (SFHGLP) and the Single Family Home Secured Loan Program (SFHGLP) on the 28th. August 2020, until March 31, 2020, 2021. The moratorium does not apply in cases where the USDA or the Lender of Services has documented that the property is vacant or abandoned.
Lenders should continue to provide relief to affected borrowers in accordance with the CARES Act by offering them withholding from payment of the loan guaranteed by the borrower for up to 180 days. In addition, the initial forbearance period can be extended up to a further 180 days at the borrower’s request. Lenders should describe potential solutions that might be available at the end of the forbearance payment and explain to borrowers that a lump sum payment of the arrears will not be required.
During the forbearance options described above, no accumulation of fees, penalties or interest can be charged to the borrower beyond the amounts calculated as if the borrower had made all contractual payments on a timely basis.
Lenders can approve the initial 180-day COVID-19 forbearance no later than the earliest of the national emergency termination dates declared by the President on March 13, 2020 or March 31, 2021.
Subsequent abstention options:
At the end of the forbearance, the lender will work with the borrower to determine if they can resume making regular payments and, if so, offer an affordable repayment plan or term extension to defer missed payments. at the end of the loan. If the borrower is unable to resume making regular payments, the lender should assess the borrower for all available loss mitigation options outlined in HB-1-3555. The measured special relief described in section 5 of Chapter 18, “Assistance in the event of a natural disaster”, will apply. These options include term extensions, compounding and term extensions, and a mortgage loan collection advance.
Questions regarding program policy and this announcement may be directed to the National Office Division at [email protected] or (202) 720-1452.
USDA Rural Development provides loans and grants to help expand economic opportunities and create jobs in rural areas. This aid supports infrastructure improvements; Business development; housing; community facilities such as schools, public safety and health care; and high-speed Internet access in rural areas. For more information visit www.rd.usda.gov.