CARES ACT Forbearance Extended by the Biden Administration

CARES ACT Forbearance Extended On Mortgages

Gustan Cho Associates are mortgage brokers licensed in 48 states

Breaking News: This Breaking News Article Is About CARES ACT Forbearance Extended On Mortgages For Homeowners. Great news for homeowners who are still having financial difficulties due to the coronavirus pandemic. As Americans continue to deal with the aftermath and chaos from the shutdowns caused by the COVID-19 coronavirus outbreak, the Federal Housing Finance Agency has announced that mortgage borrowers are now eligible for an extension of up to three months of mortgage forbearance. In this blog, we will detail this addition to the forbearance rule and how it may affect your mortgage loan. We will also cover and discuss an update from the White House CARES ACT Forbearance Extended by the Biden Administration.

CARES ACT Forbearance Extended Due To Economic Crisis Due To The COVID-19 Economic Crisis

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Forbearance and mortgage loans are as confusing as the pandemic itself. Many lenders treat this forbearance differently. And each agency has a different outlook on when you may enter a new mortgage if you are currently in forbearance. Some good news for borrowers who need relief is the Federal Housing Finance Agency has announced that all Fannie Mae and Freddie Mac mortgages may be eligible for an additional forbearance extension of up to three months.

Extended CARES ACT Forbearance Period 

Previously the maximum forbearance time frame was 12 months under the CARES ACT. So, the new extension will lengthen the maximum forbearance period to a full 15 months. Eligibility For the extension of three months is only available to borrowers who enter into forbearance prior to February 28, 2021. The Federal Housing Finance Agency has also stated additional limitations may apply.

Reprieve On Making Mortgage Payments For Homeowners Due To The Coronavirus Pandemic

If you have a government-backed loan such as an FHA mortgage, the Federal Housing Finance Agency also announced the COVID-19 payment deferral program can now cover up to 15 months of missed payments. So each conventional and FHA/VA/USDA mortgage may have a total of 15 months of a forbearance period. In the same announcement, they also extended the moratoria on single-family homes foreclosures and investment property or real estate owned evections for all properties currently mortgaged with Fannie Mae and Freddie Mac. Moving this extension to expire on March 31. This is a one-month extension as this rule was set to end on February 28, 2021.

CARES ACT Forbearance Extended To Avoid Foreclosure And Another Housing Crisis

According to the director of the Federal Housing Finance Agency, Mark Calabria, these changes are put
in place to help keep families in their homes during the pandemic. He stated the increase is to help borrowers get over the COVID-19 pandemic without the fear of losing their homes or being evicted from the property they rent. The moratorium on foreclosures applies only to single-family homes backed by Fannie Mae and Freddie Mac. This change does not apply to multi-family homes. When all is said and done, the Federal Housing Finance Agency projects that Fannie Mae and Freddie Mac will incur expenses of approximately $1.5 to $2 billion due to the ongoing forbearance extensions.

CARES ACT Forbearance To Help Consumers Affected Financially Due To Coronavirus

CARES ACT Forbearance To Help Consumers Affected Financially Due To Coronavirus

It is important to know that this help is available for those who need it. The CARES ACT has cost the American people trillions of dollars to this point. And we expect those costs to keep rising. These are difficult times for our country. It is important to give our citizens a sense of security when it comes to housing. We hope these additional three months will be enough to get over the hump. As vaccinations roll out. America is on pace to get to 75% herd immunity in the near future. This should allow Americans in the economy to get back working at full pace. We all have been working together to keep others safe.

Benefits Of Mortgage Forbearance For Homeowners

Mortgage forbearance is for those who are in need. Unfortunately, many Americans have taken advantage of the mortgage forbearance during the COVID-19 coronavirus outbreak. The mortgage forbearance was designed for individuals who have lost their job due to the pandemic.

Verification Required on CARES ACT Forbearance

There is no verification when you asked to put your mortgage in forbearance under the CARES ACT. This can come back to haunt a borrower if they plan to purchase or refinance a property in the near future. Each agency has specific guidelines for exiting forbearance and reestablishing your mortgage tradeline. We encourage you to call Mike Gracz on (800) 900-8569 to discuss your exact options to purchase or refinance in the future. You may also email Gustan Cho Associates pride itself on staying up to date on all mortgage guidelines.

Qualifying For The CARES ACT Forbearance Extension

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Qualifying for a mortgage after forbearance can be tricky. If your loan was delinquent before you entered forbearance, this can be a major issue. If your loan was on time and you truly experienced a hardship due to the COVID-19 coronavirus outbreak, the guidelines are more forgiving. Depending on the loan you are applying for, you may need to continue making on-time payments before you qualify for your next loan. No matter what you are trying to do, purchase or refinance, your current loan must be brought current before entering a new mortgage.

CARES ACT Forbearance Extended On Mortgages For Homeowners: Update February 17, 2021:

Just yesterday, the Biden administration extended the COVID-19 forbearance and foreclosure protection for homeowners throughout the country. In a briefing room update sent out by the White House, it is said that one and five renters are behind in rent and just over 10 million homeowners are behind on mortgage payments. The Department of Housing and Urban Development, the Department of Veteran Affairs, and the Department of Agriculture announced a coordinated extension and expansion with all foreclosure relief and forbearance programs. This announcement is stated in the WHITE HOUSE PRESS BRIEFING. These protections were due to expire in March and are now extended through the end of June.

Using CARES ACT Forbearance 

Some key takeaways from Biden‘s announcement include extending the mortgage payment forbearance enrollment window through the end of June for any borrower who might be experiencing hardship due to Covid-19. They will now provide an additional six months of mortgage forbearance in three months increments for borrowers who entered forbearance prior to June 20th, 2020. And extending the enrollment timeframe through the end of June 2021 for any borrowers who have yet to enter forbearance. It is estimated that these actions can directly benefit over 2.7 million homeowners and are expected to support hard-hit communities of color.

Light At The End Of The Tunnel

While it is unclear when we will be back to 100% normalcy, America is on its way to herd immunity. With increased vaccinations as well as the infection rate through the community will eventually put an end to this pandemic. The economy is going to suffer long after the pandemic is completed. We encourage you to stay up to date with the ever-changing mortgage guidelines and for any future extensions on mortgage forbearance throughout the nation. With any mortgage-related questions including those surrounding forbearance, please contact the expert, Mike Gracz on (800) 900-8569 or

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