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12.3.6.2 FHA Foreclosure Moratorium

Significant Law Change

HUD issued an initial moratorium on foreclosures, which covered the initiation of foreclosures, on March 18, 2020 through Mortgagee Letter 2020-04.86 Upon expiration of the CARES Act, HUD extended the moratorium to June 30, 2020, to August 31, 2020, to December 31, 2020, to February 28, 2021, to March 31, 2021, and then to June 30, 2021.87 The extension of the deadline to June 30, 2021, was in response to the Biden Administration’s policy announcement to help borrowers with pandemic related hardships avoid foreclosure.88

Mortgagee Letter 2021-05 (dated February 16, 2021) incorporated broad language from prior letters regarding the scope of HUD’s moratorium: “FHA-insured Single Family mortgages, excluding vacant or abandoned properties, are subject to an extension to the moratorium on foreclosure through June 30, 2021. The moratorium applies to the initiation of foreclosures and to foreclosures in process.” HUD’s moratorium also halted evictions from homes with FHA-insured single family mortgages.

Footnotes

  • 86 HUD, Mortgagee Letter 2020-04 (Mar. 18, 2020).

  • 87 HUD, Mortgagee Letters 2020-13, 2020-19, 2020-27, 2020-43, 2021-03, 2021-05.

  • 88 The White House, Fact Sheet: Biden Administration Announces Extension of COVID-19 Forbearance and Foreclosure Protections for Homeowners (Feb. 16, 2021); Federal Housing Finance Agency, News Release, FHFA Extends COVID-19 Forbearance Period and Foreclosure and REO Eviction Moratoriums (Feb. 25, 2021).