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President Trump has provided extensive relief to help keep Americans in their homes during the fight against COVID-19.  The Department of Housing and Urban Development (HUD) announced they would extend their eviction and foreclosure moratorium for Federal Housing Administration (FHA)-insured homeowners through the end of the year. 12/31/2021.


*List of banks offering help to customers impacted by the corona-virus
*COVID-19 Mortgage Forbearance: What To Know Before You Delay Payment


*COVID-19 Provisions

Fannie and Freddie released essentially identical sets of guidelines for borrowers and lenders about single-family mortgages:

  • Foreclosures.  The general stay of foreclosure proceedings, including residential foreclosure proceedings and proceedings not involving COVID-19 related financial hardship, expired on July 27, 2020.  Marks Mem. July 24, 2020.  The stay of the commencement of commercial foreclosure actions against borrowers experiencing COVID-19 related financial hardship expires on August 20, 2020.  Executive Order 202.48; AO/157/20.  Any newly commenced foreclosure proceedings, commercial or residential, must include a form notice indicating that the defendant-tenants may be eligible for an extension of time to respond to the complaint.  AO/157/20.  All foreclosure proceedings should be conducted remotely to the extent possible, and no auction or sale of property is to be scheduled prior to October 15, 2020.  AO/157/20.

  • Mortgage forbearance provided to reduce or suspend payments for up to 12 months.

  • Lenders must suspend reports to credit bureaus of past-due payments for borrowers in a forbearance plan

  • No penalties or late fees for homeowners in a forbearance plan

  • After forbearance, lender is mandated to "work with the borrower on a permanent plan to help maintain or reduce monthly payment amounts as necessary, including a loan modification," states Fannie Mae.

  • Homeowners "adversely impacted by this emergency," in the words of Fannie Mae, "may request mortgage assistance by contacting their mortgage servicer."


*Deficiency Judgments after Foreclosure


*Mortgage Forbearance Agreements vs. Loan Modifications

While a mortgage forbearance agreement provides short-term relief for borrowers, a loan modification agreement is a permanent solution to lower monthly payments. With a loan modification, the lender can work with the borrower to do a few things (such as reduce the interest rate, convert from a variable interest rate to a fixed interest rate or extend the length of the loan term) to reduce the borrower's monthly payments.

In order to be eligible for a loan modification, the borrower must show that he or she cannot make the current mortgage payments because of financial hardship, demonstrate that he or she can afford the new payment amount by completing a trial period and provide all required documentation to the lender. The documentation the lender requires could include a financial statement, proof of income, tax returns, bank statements, and a hardship statement. 

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