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Foreclosures, Mortgages

New Protections for Homeowners with VA Mortgages

A new VA final rule, effective July 27, provides new rights for homeowners exiting a COVID-19 related forbearance program. Forborne payments will not be due until the end of the mortgage term and are interest-free. This article describes both this new right to defer forborne payments and options for homeowners who cannot afford their regular monthly payments that become due after exiting forbearance.

New Protections from Foreclosure of Reverse Mortgages

A May 6th HUD guidance provides new protections allowing non-borrowing spouses to remain in a home after the spouse borrowing on a reverse mortgage moves to a long-term care facility or passes away. This article details the new protections, examines other foreclosure risks with a reverse mortgage, and sets out borrower rights and strategies to avoid those additional risks of foreclosure.

New Protections for Homeowners with VA Mortgages, Effective July 27

This article explains in detail important CFPB amendments to RESPA Reg. X taking effect August 31 affecting mortgage servicer early intervention and loss mitigation requirements. The rule provides new rights to homeowners exiting mortgage loan forbearances or experiencing a COVID-related payment hardships—rights applicable not just to federally insured mortgages, but to almost every home mortgage in America.

Two Novel Ways to Eliminate a Foreclosure

Lenders may lose their right to foreclose by waiting too many years after accelerating the loan or where a prior foreclosure litigation has been dismissed. This article explains these novel defenses and lists other foreclosure defenses.

The Qualified Principal Indebtedness Exclusion Revived and Extended for Two Years

**This exclusion has been extended to income forgiven in 2017. Read more here .** On December 18, 2015, President Barack Obama signed the Consolidated Appropriations Act of 2016, Public Law 114-113 (129 Stat. 2242; 887 pages), which includes a two-year extension of the qualified principal residence indebtedness exclusion that had expired at the end of 2014. The qualified principal residence...

Free Access to New Chapter on Homeowner Rights During COVID Pandemic

NCLC’s new chapter on homeowner rights during the COVID pandemic is free to the public for a limited time period. This article summarizes the new chapter, covering the very latest rights and options for those with Fannie Mae, Freddie Mac, FHA, VA, RHS, or other mortgages. The chapter being open to the public, all readers can now follow links in the article to more detail in the chapter text.

The Federal Housing Finance Agency’s Principal Reduction Modification Program (Very Modest and Very Late)

On April 14, 2016 the Federal Housing Finance Agency (FHFA) announced what it described as its final loss mitigation initiative of the foreclosure crisis, a “Principal Reduction Modification Program.” The Program will apply to a limited number of loans owned or insured by Freddie Mac or Fannie Mae. Borrowers will not be able to apply for these modifications. Instead, during the latter half of 2016...

Six Ways to Avoid the “One-Bite” Rule for RESPA Loss Mitigation Applications

In evaluating whether to file a court action for violations of the RESPA Reg. X loss mitigation rule, determine if the servicer evaluated any of the client’s earlier loss mitigation applications. Reg. X, 12 C.F.R. § 1024.41(i) provides that a servicer is "only required to comply with the requirements of this section for a single complete loss mitigation application for a borrower’s mortgage loan...

Qualified Principal Residence Indebtedness Exclusion Revived and Extended

Congress has just revived and extended the QPRI exclusion, an important protection for struggling homeowners. As discussed in this article, now a homeowner with a short sale or other modification of their home mortgage loan principal can avoid tax liability on debt forgiven during tax years 2018, 2019, and 2020, despite receiving a 1099 indicating the forgiven debt as income.