Do You Want Assist Saving Your FHA Mortgage?
Worried about your solvency on your FHA home loan? You are not alone and the FHA and HUD want to help.
Many foreclosure prevention measures have been taken by lenders and the FHA / HUD, including a COVID-19-related moratorium on foreclosure, loan modification options for qualified applicants, and more.
In early 2021, the FHA and HUD announced “loss mitigation options” to help those recovering financially from the pandemic; This included a COVID-19 Advance Loan Modification, the “… eligible defaulting borrowers who can achieve a 25 percent reduction in the capital and interest portion (P&I) of the borrower’s monthly mortgage payment by changing the interest and term of the loan for 30 years” , was offered at HUD.gov
The FHA and HUD continue to evaluate how the pandemic has financially impacted the agency’s ability to guarantee loans and the nation’s recovery from COVID-19.
Despite evidence that “economic indicators are trending positively,” the HUD may need further relief to “support sustainable and equitable recovery and protect the Mutual Mortgage Insurance Fund.”
In the age of COVID, there are still options for what HUD calls “loss reduction”. That essentially means helping FHA borrowers who could be financially affected by COVID-19 issues in 2021 will continue to be offered help. What Options Do FHA Borrowers Have?
According to a recently published Mortgagee Letter (FHA Mortgagee Letter 2021-18, issued late July 2021), FHA borrowers who may need and qualify will be offered the following options – according to the HUD, these options are for “directly affected borrowers or” indirect by COVID-19 “;
–COVID-19 prepayment change
–COVID-19-Recovery-Independent partial claim
–COVID-19 recovery change
–COVID-19 recovery non-occupant loan modification
–COVID-19 sale before foreclosure
–COVID-19 replacement deed of foreclosure
The FHA and HUD streamlined some options in mid-2021, but there are still options for borrowers who need them. If you find yourself in financial distress related to the pandemic, it is important that you contact your loan service provider immediately to see what options are available to you.
Those who miss more than one home payment will find that their options for preventing foreclosures are reduced with each missed payment.
Acting quickly to secure your mortgage gives you more flexibility than missing out on a payment that may be the point where a foreclosure never comes back.
Granted, foreclosures have been put on hold as part of COVID-19 aid to FHA mortgages, but the moratorium on foreclosures won’t last forever; Sooner or later, homeowners will struggle with the end of this pandemic relief effort.
Those who act sooner rather than later are most capable of saving their homes.
Find out more about the path to home ownership
Take the guesswork out of buying and owning a home. Once you know where you want to go, we’ll get you there in 9 steps.
Step 1: How Much Can You Afford?
Step 2: Know Your Home Buying Rights
Step 3: basic mortgage terminology
Step 4: buy a mortgage
Step 5: shopping for your home
Step 6: Make an offer to the seller
Step 7: get a home inspection
Step 8: home insurance
Step 9: what to expect upon graduation