FHA extends forbearance request deadline after CSBS seeks specifics

The Federal Housing Administration on Monday pushed the deadline for initial mortgage forbearance requests by two months as Congress extended broader coronavirus-related relief for consumers through January.

The FHA’s deadline was extended to Feb. 28, 2021, as part of its latest renewal of coronavirus-related contingencies, which include a foreclosure moratorium, re-verification of employment guidance, an exterior-only appraisal inspection option, and provisions for the verification of self-employment, rental income and the 203(k) escrow accounts. The deadline for FHA insurance endorsement of single-family mortgages in forbearance was extended to March 31, 2021.

Previous to this week’s announcement, the Federal Housing Administration had a Dec. 31 deadline for CARES Act forbearance requests.

Other housing agencies’ deadlines at press time were as follows, with some expectation that those with year-end deadlines could extend by at least one month into next year.

The USDA’s deadline for forbearance requests and its foreclosure moratorium has been Dec. 31, but requests may continue as long as the National Emergency is in place. The Department of Veterans Affairs has guidance allowing coronavirus-related forbearance requests that will remain in place until April 21, 2021, and its foreclosure moratorium deadline has been year-end. Certain jurisdictions have separate moratoria on foreclosures.

The government-sponsored enterprises at deadline still had no specific deadline for forbearance requests, and a Jan. 31 moratorium for foreclosures. However, spokespersons at Fannie Mae and Freddie Mac said that is because they provide forbearance relief in line with the CARES Act on an ongoing basis through their own programs. Their conservator and regulator, the Federal Housing Finance Agency, did not respond to requests for comment.

The deadlines for CARES Act forbearance requests are important because not all programs are as consumer-friendly as what is offered through the legislation. CARES Act forbearance does not apply to private loans.

Under the CARES Act passed in March, forbearance for a coronavirus-related hardship must be provided upon request for 180 days, extendable by another 180 days, and the borrower must make up the payments later.

As a result, John Ryan, president and CEO of the Conference of State Bank Supervisors, has been calling for federal agencies to be clear on their deadlines for initial forbearance requests if one is imminent.

“The question for those agencies is, ‘Is there a date by which you have to request CARES Act forbearance from your servicer?’ State regulators feel it’s important that if that date is coming soon that they’re communicating with their constituents about that deadline,” said CSBS Communications Director Catherine Pickels.

Ryan on Tuesday applauded the collective effort by housing agencies to provide notice on any deadlines they have for forbearance requests.

“This action provides clarity on the appropriate covered period. Importantly, it also gives consumers a clear understanding of the relief available to them,” he said in an emailed statement.

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