Millions of homeowners struggling to make their mortgage payments due to the coronavirus pandemic could get a new reprieve under new rules proposed this week by the Consumer Financial Protection Office.
The plan would essentially prevent mortgage servicers from initiating foreclosure proceedings until after December 31, 2021, the CFPB said in a statement. More than 3 million households are behind on their mortgage payments and nearly 1.7 million will come out of their tolerance period in September.
MANCHIN REJECTS BIDEN’S CORPORATE TAX INCREASE
“Millions of families are at risk of losing their homes to foreclosure in the coming months, even as the country reopens,” CFPB Acting Director Dave Uejio said in a statement.
Office officials said the proposal is intended to give borrowers who have fallen behind or missed their mortgage the opportunity to resume or modify their monthly payments before lenders move to take over or sell the home to get the loan back. lost money.
The agency proposed a new rule that would prevent servicers from initiating foreclosure proceedings until after Dec. 31. The intention, office officials said, is to give borrowers leaving forbearance time to consider their options, such as whether they need a mortgage modification to lower their monthly payments. The restriction would apply only to mortgages on homes used as a primary residence.
GET FOX BUSINESS GOING CLICKING HERE
“The nation has endured more than a year of a deadly pandemic and a severe economic crisis,” Uejio said. “We must not lose sight of the dangers that so many consumers still face.”
CLICK HERE TO READ MORE ABOUT FOX BUSINESS
In February, President Biden ordered federal housing regulators to extend mortgage forbearance programs for an additional six months and extend other foreclosure relief programs.
Mortgage giants Fannie Mae and Freddie Mac also extended their foreclosure and forbearance programs in February. People with properties backed by the federal government can defer their mortgage payments for up to 15 months.