HUD ISSUES NEW CARES ACT MORTGAGE PAYMENT RELIEF FOR FHA SINGLE FAMILY HOMEOWNERS

Mortgage servicers instructed to offer deferred or reduced mortgage payments

by as much as 6 months to start

WASHINGTON – The U.S. Department of Housing and Urban Development today announced a tailored set of mortgage payment relief options for single family homeowners with FHA-insured mortgages who are experiencing financial hardship as a result of the COVID-19 National Emergency. Also included is an extension period for seniors with Home Equity Conversion Mortgages. Read today’s Mortgagee Letter.

           Effective immediately for borrowers with a financial hardship that makes them unable to pay their mortgage due to the COVID-19 National Emergency, mortgage servicers must extend deferred or reduced mortgage payment options – called forbearance – for up to six months, and must provide an additional six months of forbearance if requested by the borrower. This mandate implements provisions contained in the landmark Coronavirus Aid, Relief, and Economic Security Act (CARES Act) which President Trump signed into law on March 27, 2020.

“The last thing any of us wants is for Americans to lose their homes unnecessarily while we continue to fight this invisible enemy. If you’re struggling, immediate help is now available. The FHA will continue to work with stakeholders to ensure that the loss mitigation options that are offered for both forward and reverse borrowers are appropriately tailored for the present situation,” said HUD Secretary Ben Carson.

In addition to special COVID-19 forbearance, FHA also implemented today the COVID-19 National Emergency Partial Claim, an option to be used by servicers when the COVID-19 forbearance period ends. This partial claim will help eligible homeowners who have been granted special COVID-19 National Emergency forbearance to reinstate their loans by authorizing servicers to advance funds on behalf of homeowners. The partial claim will defer the repayment of those advances through an interest-free subordinate mortgage that the borrower does not have to pay off until their first mortgage is paid off.

Further, FHA today instructed mortgage servicers to:

·       Delay submitting Due and Payable requests for Home Equity Conversion Mortgages by six months, with an additional six-month delay available with HUD approval; and

·       Extend any flexibility they may have under the Fair Credit Reporting Act relative to negative credit reporting actions.

“For American families impacted by the COVID-19 virus and unable to pay their FHA-insured mortgage, imminently losing their homes is now one less fear they should have. Today’s actions will ease the immediate pressures faced by many Americans who, through no fault of their own, are struggling with financial uncertainty,” said Assistant Secretary for Housing and Federal Housing Commissioner Brian Montgomery

Borrowers who are not currently impacted and able to make their monthly mortgage payments should continue doing so.  However, those who are experiencing financial hardship as a result of the COVID-19 National Emergency should immediately contact their mortgage servicer – the entity to which they make their monthly mortgage payments – to discuss forbearance or other options that may be available to them. Borrowers who are not experiencing an income reduction due to COVID-19 are asked to avoid contacting their mortgage servicer about these options, as these questions will divert resources from serving those truly in need.  

To assist homeowners with FHA-insured mortgages in understanding these options, FHA has also published a Q&A for consumers at https://www.hud.gov/sites/dfiles/SFH/documents/COVID-19HomeownerHelp.pdf 

Rod's Comment: I am now retired but served for many years as a housing counselor, working primarily in "mortgage default" since 2007.  I have helped a lot of people avoid losing their home but unfortunately seen a lot of people lose their home because they did stupid stuff. A forbearance is an excellent tool to help a person through a rough spot who can not make their housepayment. However, it is a temporary solution and at the end of the period of forbearance all of the payments that accumulated are due. You may be eligible for a partial claim or a modification or repayment plan, but it is not automatic. Don't try to do this on your onw, get professional advice from a HUD-approved housing counselor. 

Don't lose your home to foreclosure during the Coronavirus crisis.

by Rod Williams - I am retired now but spend about the last thirty years working for a HUD-approved non-profit housing counseling agency. Up until 2007 I worked helping low-income people become homeowners. After the 2007 housing crisis hit and up until I retired I worked mostly in mortgage-default, helping people avoid losing their home. Unfortunately, a lot of people have poor money management skills, to put it mildly. To be less generous, I would say a lot of people are irresponsible. I see reports that say 70% of Americans live paycheck to paycheck. That does not generate sympathy from me. They shouldn't. It is irresponsible to not have some savings. I know bad things can happen to good people and there are some people living on the edge who can't help it. However, for the majority of people who are financially living on the edge, they never learned discipline and delayed gratification. That being said however, I don't want them to lose their home, because they lost their job. With the closing of bars and restaurants, a lot of people already find themselves unemployed. With the further lockdown, more people are losing their job. The longer this crisis lingers, the more people will lose their job. A lot of people, when they lose their job will lose their house. A lot of people lose their home because they do the wrong things. If one has some savings, one has a better chance to keep one's home than if one does not, but the savings only delays the foreclosure unless one acts wisely. With savings are not having savings, there are steps to increase the likelihood that you will avoid foreclosure. Your solution for avoiding foreclosure and keeping your home can vary depending on several factors. Here are some of them: Who actually owns your mortgage and what policy for foreclosure avoidance to they have in place. The company you pay your mortgage payment to is most often a servicer of the mortgage and their options are limited by the entity that insures your mortgage or owns your mortgage. How is your home titled? If you are married is the mortgage in both names? If you once owned a home jointly with a spouse and are now divorced and were awarded the home through divorce, did you ever have the ex-spouse's name removed from the mortgage and the title? When you lost your job, did you just quit because the company was reducing staff or closing their doors or were you laid-off? Your housing ratio, which is the percentage your gross income that it takes to pay the house payment, and your debt ratio, which is the percentage of your gross income it takes to pay all debt, are factors. Before the crisis did you pay your mortgage on time? It can be complicated. I am listing some general guidelines of what to do if you lose your job and own a home and don't want to lose it. This are general. Other recommended actions would depend on ones specific variables. Immediately get on a crisis budget. Cut all unnecessary expenses. Prioritize. If you have two car payments and a house payment, it is probably better to lose a car than a house. As a housing counselor, I have seen people lose their home who could have saved their home if they would have tightened their belt and prioritized their spending. If you have not applied for unemployment, do it! If the unemployment office says you must have a separation letter from your employer, get it. Communicate with your mortgage company. Don't sent partial payments. Some people think paying half a mortgage payment or whatever they can afford shows good faith and helps them with their mortgage company. It doesn't. If you are not making payments do not let the money you could have paid toward a mortgage payment just get adsorbed in other spending. Save it, so when you do get a workout offer, you have some money to pay toward your mortgage. Don't think a "forbearance" means you can just skip some payments. A forbearance is a temporary plan to skip payment for a while but at the end of the period, the accumulated skipped payment must be paid or a plan put in place to catch them up. See a HUD-approved housing counselor. A counselor can evaluate your situation, develop an action plan for dealing with the crisis and advocate on your behalf. Don't try to do this alone. Be aware of scams. If someone ask you for money to help you avoid foreclosure, it is probably a scam. Don't move out of your home. Some people panic and move. If you are living in your home, you are more likely to be eligible for a workout plan or assistance than if you have abandoned your home. If this crisis continues, there will probably be more programs to help people avoid foreclosure as there were when the housing crisis of 2007 hit. Don't count on it but don't do stupid things that would disqualify you from taking advantage of whatever program may be offered. Taking on more debt is one of the things people do in a crisis that is the wrong thing to do and may disqualify them from whatever workout solution or assistance for which they would otherwise be eligible. Don't panic. Don't bury your head in the sand and just assume it will all work out. Be proactive. I wish all who are facing this crisis, the best. Here are some important links: HUD Approved Housing Counseling Agencies National Community Reinvestment Coalition.

New program may save your home from foreclosure: Principal Reduction Recast Program with Lien Extinguishment

The following is from the THDA website: 

The Tennessee Housing Development Agency’s (THDA) Principal Reduction Recast Program with Lien Extinguishment (PRRPLE) will lower monthly mortgage payments to affordable levels for eligible homeowners by providing (1) a reduction in the principal balance of their first mortgage loan, combined with a loan recast, modification, refinance or (2) principal reduction which results in a full lien extinguishment.

This program is available to qualifying homeowners who are facing a financial hardship, through no fault of their own, which resulted in a loss of income due to the death of a spouse, divorce, or underemployment.

The goal of the program is to reduce delinquencies and foreclosures by lowering mortgage payments to affordable levels for homeowners who have encountered a financial burden due to an eligible hardship, including but not limited to homeowners who are living on social security, long-term disability or other fixed income source.

If you have questions or need assistance with the PRRPLE application please call (855) 890-8073 or email PRRPLE@thda.org.

This is a great program and may save your home if you meet the criteria and if you can successfully apply.  The program expects a consumer to be able to answer questions they may not understand and assumes they know terminology they may not know.  To apply, you must scan and upload documents.  If you are a loan processor or a legal secretary it should be easy to make application by yourself; anyone else may have difficulty.

It you want help completing an application, call me.  There is no charge for my services.  I will evaluate you and see if you are eligible and if you are I will help you make application.  I can scan document for you and notarize documents and help you write letters you may need to write.  You can apply without help but your chances of successfully applying are greatly enhanced if someone who knows what they are doing helps you. I am a counselor with a HUD-approved housing counseling agency and have over 20 years of experience as a housing counselor and am good at what I do.  The agency is Woodbine Community Organization. Call me, Rod Williams, 615-850-3453.

The Home Affordable Modification Program (HAMP) will now include a "streamlined" modification.

Supplemental Directive 15-06 issued July 1, 2015 announced that The Home Affordable Modification Program (HAMP) will now include a "streamlined" modification. This new directive does not apply to GSE mortgages such as those owned or insured by Fannie Mae or Freddie Mac or VA loans or FHA loans.  Those loans are governed by different directives.  Any investor or servicing agreement that permits a servicer to offer HAMP Tier I or Hamp Tier II is encouraged to permit Streamline HAMP modifications.

This is another tool to help homeowners avoid foreclosure.  Customers who have previously been granted a HAMP Tier 1 or HAMP Tier II modification and have experienced a interest rate step-up and then again become delinquent may be eligible for the new Streamlined HAMP. This is a relaxation of a previous prohibition against multiple modification. Also, if a borrower was previously evaluated for, but not offered, a HAMP modification, they may be eligible for a Streamline HAMP.

There are a lot of variables at play in determining if one should be eligible for a modification or other program to avoid foreclosure.  If one should be eligible, then whether one actually gets the work out is a function of correctly and completely completing the paperwork.   I work for a HUD-approved housing counseling agency and have over twenty years experience as a housing counselor. There is no charge for my service.  I can evaluate you for a solution to your housing problem, and if you should be eligible for a workout, I will help you complete the Request for Mortgage Assistance.  To learn more, or to schedule an appointment call me.

Rod Williams
615-850-3453

HAMP ends this year. Don't miss out.

From Freddie Mac:

Extensions for HAMP and the Freddie Mac Streamlined Modification Among the Highlights in Guide Bulletin 2015-9

We are making several updates reflected in Freddie Mac Guide Bulletin 2015-9, including the following key highlights:

• A one-year extension of the Home Affordable Modification Program (HAMP). As a result of previous announcements made by the U.S. Department of the Treasury and the Federal Housing Finance Agency to extend HAMP, we have updated Section C65.4 of the Guide to require that all HAMP modifications have a Modification Effective Date on or before September 1, 2017, and that all evaluations for HAMP must be based on a complete Borrower Response Package submitted on or before December 31, 2016.

My Comment: I know this is only June, but sometimes to submit a package for a modification and allow time for the package to be worked can take months.  If the package sits on someone's desk and they do not get around to until your check stub or bank statement is  older than 30 days, they ask for new documents.  If the documents are not current, then they do not have a Borrower Response Package.

If you need help, don't wait!

My name is Rod Williams and I am a HUD approved housing counselor. There is no cost for my services. Many people who apply for a modification don't get it because they fail to complete a package correctly.  I can increase your chance of getting a modification.  Also, sometimes a modification is not the best option. If you have a housing problem, don't try to solve it by yourself. Call me at 615-850-3453.

HARP extended through 2016

The program known as Keep My Tennessee Home, which was Tennessee's version of the Hardest Hit Fund program ended some months ago, but there are still options available for avoiding foreclosure if you are having difficulty making your house payments.  For a review and evaluation call me.  I am a housing counselor with a HUD-approved housing counseling agency and there is no cost for my services. Rod Williams, 615-850-3453.

Below is new information about HARP, the Home Affordability Refinance Program.

Program Overview

The Federal Housing Finance Agency (FHFA) and the Department of the Treasury introduced HARP in early 2009 as part of the Obama Administration’s Making Home Affordable program. HARP provides borrowers, who may not otherwise qualify for refinancing because of declining home values or reduced access to mortgage insurance, the ability to refinance their mortgages into a lower interest rate and/or more stable mortgage product.

Homeowners Helped Since Program Inception

As of August 31, 2011, nearly 894,000 borrowers had refinanced through HARP.

HARP is only one refinancing option

HARP is only one of several refinancing options available to homeowners. Since April 2009 when HARP began, Fannie Mae and Freddie Mac have helped approximately nine million families refinance into a lower cost or more sustainable mortgage product. HARP is unique in that it is the only refinance program that enables borrowers who owe more than their home is worth to take advantage of low interest rates and other refinancing benefits.

Borrower Eligibility

• The existing mortgage must have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009.
  Homeowners can determine if they have a Fannie Mae or Freddie Mac loan by going to:
  http://www.FannieMae.com/loanlookup/  or calling 800-7FANNIE (8 am to 8 pm ET)
  https://ww3.FreddieMac.com/corporate/ or 800-FREDDIE (8 am to 8 pm ET)
• The program will continue to be available for loans with LTVs above 80 percent.
• Borrowers must be current on their mortgage payments with no late payment in the past six months and no more than one late payment in the past 12 months.
• Borrowers should contact their existing lender or any other mortgage lender offering HARP refinances.

**On May 8, 2015, FHFA announced the extension of HARP through 2016.

Other Resources

www.MakingHomeAffordable.gov  or call 1-888-995-HOPE (4673)
www.KnowYourOptions.com  or www.FannieMae.com/homeowners
www.FreddieMac.com/avoidforeclosure 

Keep My TN Home ends this month!

The Keep My Tennessee Home program is running out of money and winding down.  It will not be renewed.  When it is gone, it is gone. If you have been putting off applying, don't delay any longer!

If interested in the program, call me.  I will screen you on the phone and not waste your time.

Rod Williams 615-850-3453
This is for middle Tennessee homeowners only.