There has been and will continue to be a lot of information about the Federal Announcement President Trump made regarding foreclosures during the COVID-19 Pandemic and we wanted to take a moment to explain how this may impact you and your family as it currently stands.
President Trump’s Foreclosure Suspension Announcement on March 18, 2020:
On March 18, 2020, President Trump announced that, “The Department of Housing and Urban Development [HUD] is providing immediate relief to renters and homeowners by suspending all foreclosures and evictions until the end of April.”
HUD later confirmed that the foreclosure moratorium would apply to single-family homeowners who have an FHA-insured mortgage.
o This Federal suspension of foreclosures only applies to FHA-insured loans.
o Moratorium Period = 60 days.
o Moratorium applies to the initiation of foreclosures and the completion of foreclosures already in process.
It is important to note, that FHA loans represent only a small portion of the loans in California.
How do you know if you have an FHA-insured loan/mortgage?
o An FHA-insured loan/mortgage is one backed by either Fannie Mae or Freddie Mac.
o Check your Hud-1 Statement included with your loan closing documents.
- At the top of page one of the HUD-1 Statement is a set of boxes with loan acronyms next to it. The very first box is the FHA box. If you have an FHA loan, this box is checked.
Based on our assessment, the announcement President Trump made, will only protect a small portion of Homeowners.
It is important that you know if you will be protected against foreclosure as we anticipate that as they did in the last recession, the banks will not slow down on foreclosing on properties during the COVID-19 epidemic.
We will continue to update you as things evolve. In the meantime, please don’t hesitate to call us. We are always here to help.
Jason W. Estavillo, Esq.