Government Support Resources During COVID-19: Housing FAQ
This page contains information about the government’s COVID-19 program for housing. Use the links below to access the Cash Flow & Financial Assistance FAQ, or return to the main COVID-19 Resource Center home page.
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Housing: Keeping families in their homes
Important to note that this is not a forgiveness of payments, just a postponement.
Consumers have the right to request a temporary postponement of mortgage payments for up to one year. No fees or additional interest is applied during the forbearance period.
Important to note that this is not a forgiveness of payments, only a postponement.
Anyone holding a federally-backed mortgage (FHA, VA, USDA, or Conventional).
June 30, 2021
Mortgage lenders are banned from beginning the foreclosure process on federally-backed mortgages due to non-payment for 60 days beginning March 18, 2020.
Anyone holding a federally-backed mortgage (FHA, VA, USDA, Conventional).
June 30, 2021
Tenants are protected under eviction moratoriums on a state by state basis.
State by state basis.
March 31, 2021
*CARES Act: The Coronavirus Aid, Relief, and Economic Security Act, also known as the CARES Act, is a law intended to address the economic fallout of the COVID-19 pandemic in the United States
FORBEARANCE, FORECLOSURES, EVICTIONS, RENTAL ASSISTANCE
A forbearance is an agreement with your mortgage servicer or lender that allows you to pause or reduce your mortgage payments for a limited period of time while you are experiencing financial hardship. Forbearance doesn’t mean payments are forgiven or erased and missed payments will still need to be paid at a future date. You can review the Consumer Financial Protection Bureau guide to coronavirus mortgage relief options here.
Borrowers with federally-backed mortgage loans (FHA, VA, USDA, Conventional) may contact their servicer and request forbearance for up to one year if they are experiencing financial hardship due to the COVID-19 emergency. No documentation of hardship is required.
At this time, mortgages that are not backed by the federal government do not qualify for relief but options may still exist by contacting the mortgage servicer.
Mortgage servicers to provide forbearance options on all federally-backed mortgages. Your mortgage is considered federally-backed if it is a Federal Housing Administration (FHA), Veterans Affairs (VA), US Department of Agriculture (USDA) or conventional loan through Fannie Mae or Freddie Mac. If you are unsure if your loan falls into one of these categories, you can find out by using the conventional loan look-up tools below or by calling your mortgage servicer.
Fannie Mae – Go here to see if your loan is owned by Fannie Mae.
Freddie Mac – Go here to see if your loan is owned by Freddie Mac.
If your loan is not federally-backed, you may still have options available to you. No matter your loan, you should reach out to your mortgage servicer if you are having trouble making your mortgage payments.
If you are struggling to pay your mortgage payments today, a forbearance may be the best option for you as it allows for an immediate pause in payments. It’s important to note that any missed payment will need to be repaid later on. Additionally, borrowers who have entered into a forbearance will not be able to refinance their mortgage for at least 12 months after the forbearance period ends.
If you are able to pay your mortgage but would benefit from lower monthly payments, you may consider refinancing to a lower interest rate. With mortgage rates today at near record lows, many families would benefit from refinancing their current mortgage. Reach out to your lender to discuss whether or not a refinance would make sense for you.
To apply for forbearance, call your mortgage servicer. You can find the contact information for your servicer’s office on your monthly mortgage statement. When you apply, please be sure to ask your mortgage servicer for the terms of the forbearance, including how missed payments will be repaid later on. In addition, it is important that you let your mortgage servicer know you have been impacted by COVID-19 and ask for written proof that the disaster code labeled “AW” is notated on your credit report. If you are simply asking for more information about a forbearance, make sure they DO NOT include the AW disaster code on your credit report. Ask for proof in both circumstances.
If you would just like to inquire about forbearance but don’t want to call your servicer, reach out to a housing counselor for assistance. Click here for a list of HUD approved housing counselors.
Remember, forbearance is not the same as loan forgiveness. At the end of your forbearance period, you will need to pay back the missed payments on your loan. Each servicer will have different options for repayment at the end of the forbearance period. Your servicer should have informed you about the repayment terms prior to your loan going into forbearance. If you are currently in forbearance but do not understand the repayment terms, call your mortgage servicer and ask for an updated amortization (payment) schedule and any other questions you may have.
There are several options for repaying missed payments at the end of a forbearance period. The options offered may vary depending on your servicer.
- If you can afford to resume your regular payments, you should ask your servicer for a loan modification that is either a deferment (an extension of the length of your loan by the amount of months in forbearance) or a cap and extend modification (description below).
- If you can afford to resume your payments when forbearance period is over and pay a bit more, explore short-term repayment options.
- If you can’t afford to resume your payments, ask to be evaluated for all available loss mitigation options. In addition to the above, there may be other options.
- Short-term repayment plan – In this situation, your missed mortgage payments will be spread out over a period of time and added to your regular mortgage payments once you begin paying again.
For example, if your mortgage payment is $1,000 per month and you go into a forbearance period for three months, you could pay back your missed payments over a six-month period by paying $1,500 per month after your forbearance period ends.
- Extended loan modification – In this situation, your missed mortgage payments get tacked on to the back of your loan, adding the amount of time missed to the end of your loan term. This option does not require you to increase the monthly payment amount.
For example, if you have ten years left on your mortgage and you enter into a forbearance period of six months, your term will expire ten years and six months after you begin making payments again.
- Flex modification – In this situation, the mortgage servicer will modify a loan in order to make it more affordable. This typically happens when the borrower cannot afford to continue to make mortgage payments under the current terms, regardless of repayment. It is in both yours and the lender’s best interest that you don’t go into foreclosure. Therefore, they will work with you to make sure there is a modification that works for your situation.
There are many ways in which a loan can be modified and some modifications will lead to significantly higher interest payments over the life of the loan. Be careful to review the modification terms closely and seek professional help if needed.
- Cap and extend – In this situation, mortgage servicers will cover taxes and insurance payments for borrowers who cannot afford to keep making them while in forbearance. At the end of the forbearance period, the amount the mortgage servicer paid on the borrower’s behalf will be capitalized and added on to the outstanding principal of the mortgage, and the term will be extended by the length of the forbearance period.
For example, If you pay $500 per month for property taxes and insurance and you are in forbearance for a total of 3 months, the servicer will continue to make those payments on your behalf. When the forbearance period ends, the $1500 that was paid on your behalf is added to the outstanding principal on your mortgage and three months will be added to your mortgage term.
- Lump sum repayment – In this situation, the full amount of missed payments is due immediately at the end of the forbearance period or at the end of the term. Federally-backed mortgages (FHA, VA, USDA, and conventional) will NOT require a lump sum at the end of your forbearance period due to COVID-19. If you have a privately-held mortgage and your mortgage servicer presents a lump sum as an option to you for repayment, please note you are able to negotiate alternative repayment options most of the time.
The Federal Housing Finance Agency announced in April that mortgage servicers for Fannie Mae and Freddie Mac loans will NOT require a lump sum repayment on any mortgages that have gone into forbearance due to hardship during COVID-19. The FHFA has strongly urged private mortgage servicers to do the same. FHA, VA, and USDA programs never require a lump sum at the end of a forbearance period.
Re-payment options for privately-owned loans – While privately-owned loans are not protected under the CARES Act or by FHFA guidelines, private lenders are being encouraged to work with borrowers on setting reasonable repayment options. Most mortgage servicers will be motivated to provide repayment options that borrowers can actually afford in order to avoid foreclosure. Reach out to your mortgage servicer to discuss options, ideally before your loan become delinquent.
Under the CARES Act, a forbearance should not negatively impact your credit score if your loan was current prior to entering into the forbearance period, regardless of whether or not your loan is backed by the federal government. All mortgage servicers are required to use a disaster code labeled “AW” on your credit report and report the account as current, as long as the account was current when accommodations were made.
However, if your loan is in forbearance, you might not be able to qualify for a refinance or another loan for at least 12 months after the forbearance period ends.
Even if you loan doesn’t qualify for forbearance under the CARES Act, it is strongly suggested that you reach out to your mortgage servicer for help. Your mortgage servicer is the company to which you make your monthly mortgage payments. Not only are private lenders being encouraged to make accommodations for borrowers who cannot afford their payments during the pandemic, it is their best interest to avoid a foreclosure on your loan. The sooner you call to negotiate with your servicer, the better position you will be in.
It depends. The Consumer Financial Protection Bureau (CFPB) prevents initiation of foreclosure until you are 120 days delinquent. If you have been more than 120 days delinquent and you have a federally-backed mortgage (FHA, VA, USDA, or conventional), your home is safe from foreclosure until December 31, 2020. However, if you are not making mortgage payments and you have not applied for forbearance, your mortgage servicer could have begun foreclosure proceedings after the moratorium expired. If you have a private mortgage that is not backed by the federal government, your mortgage servicer can begin foreclosure proceedings before then. It is important that you communicate with your servicer as soon as you begin to have trouble making payments.
If you are current on your payments or if you have entered into a forbearance, you are safe from foreclosure as long as you keep to the terms of your agreements. If you have a difficult time understanding the terms of your mortgage, reach out to a professional for help.
Support for Renters/Landlords
Yes, tenants are obligated to make rent payment under an eviction moratorium. During an eviction moratorium, landlords may not evict tenants under the law due to non-payment, but landlords still have the right to collect rent after the moratorium is lifted. If a tenant does not make any or negotiate a payment plan with their landlord, they will be subject to eviction when the moratorium ends.
The federal eviction moratorium only applies when tenant receive federal assistance from a voucher or grant program, the tenant or landlord receives assistance through federally-subsidized housing programs or the rental home/apartment building has a federally-backed mortgages. Find out if this applies to you here.
Almost every state has had some sort of eviction moratorium in place due to the crisis. While there is a moratorium on evictions for now, once the moratoriums expire, landlords will be able to move forward with evictions. Most state expiration dates were scheduled to take place in late May or early June. Be sure to communicate with your landlord now and set up a payment plan in order to avoid eviction later on. The next stimulus bill may include support for renters. Stay informed as you might qualify for help with your rent payments during the pandemic.
This program makes available $25 billion to assist households that are unable to pay rent and utilities due to the COVID-19 pandemic. The funds are provided directly to states, U.S. territories, and local governments. Grantees use the funds to provide assistance to eligible households through existing or newly created rental assistance programs.
- One or more individuals within the household has qualified for unemployment benefits or experienced a reduction in household income, incurred significant costs, or experienced other financial hardship due, directly or indirectly, to the COVID-19 outbreak; OR
- One or more individuals within the household can demonstrate a risk of experiencing homelessness or housing instability; OR
- The household has a household income at or below 80% of area median income
Rental assistance checks will go to landlords to pay for rent, back pay on unpaid rent, utilities and home energy costs that are past due, and other housing expenses during the pandemic.
If your tenant receives rental assistance, you may not evict them.
An application for rental assistance may be submitted by either an eligible household or by a landlord on behalf of that eligible household. Households and landlords must apply through programs established by each state. In general, funds will be paid directly to landlords and utility service providers. If a landlord does not wish to participate, funds may be paid directly to the eligible household. For a list of where to apply check here.
The assistance can last up to 12 months, plus an additional three months if necessary. The payment of existing housing-related arrears such as unpaid rent or utility payments that could result in eviction if not paid will be prioritized. Assistance must be provided to reduce an eligible household’s rental arrears before the household may receive assistance for future rent payments. Once a household’s rental arrears are reduced, the state program that provided funds may only commit to providing future assistance for up to three months at a time. Households may reapply for additional assistance at the end of the three-month period if needed and the overall time limit for assistance is not exceeded.
Agencies will make payments to landlords and/or utility providers on behalf of eligible households. If a landlord or utility provider is unwilling to participate, (you may not evict your tenants if they receive assistance), the agency may provide funding directly to eligible households. Landlords may either assist renters in applying for assistance or apply on behalf of renters. With the latter, the landlord must obtain the signature of the tenant, provide documentation of the application to the tenant, and use any payments received to satisfy the tenant’s rental obligations.
Yes. Financial assistance for prospective rent payments is limited to three months based on any application by or on behalf of the household. However, a household may receive assistance for prospective rent payments for additional months if:
- There is still remaining funds left in your states Emergency Rental Assistance Fund
- They apply again to pay for future rental payments.
The total months of assistance provided to the household cannot exceed 12 months (plus an additional three months if necessary to ensure housing stability for the household, subject to the availability of funds).
The state agency must make reasonable efforts to obtain the cooperation of landlords and utility providers to accept payments from the ERA program. The agency will consider outreach complete if:
- a request for participation is sent in writing, by mail, to the landlord or utility provider,
- The landlord or utility provider does not respond to the request within 14 calendar days after mailing;
- the state agency has made at least three attempts by phone, text, or e-mail over a 10 calendar-day period to request the landlord or utility provider’s participation;
- or a landlord confirms in writing that the landlord does not wish to participate. The final outreach attempt or notice to the landlord must be documented.
The law establishing the Emergency Rental Assistance Program does not impose restrictions based on immigration status.
Below you can find the link for each state with a NAHREP chapter footprint that is currently offering an Emergency Assistance Program. Any state program not currently listed should be available by the end of March.
The National Eviction Moratorium Deadline is March 31st 2021. This deadline could be extended soon. Please check back for updates.
The information provided in the NAHREP COVID-19 Resource Center does not represent legal interpretation, guidance, or legal advice from NAHREP. While efforts have been made to ensure accuracy, this document does not bind NAHREP and does not create any rights, benefits, or defenses, substantive or procedural, that are enforceable by any party in any manner.