Biden extends mortgage forbearance, foreclosure relief programs
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More than 2.7 million homeowners are in forbearance, meaning they’ve reduced or paused their mortgage payments during the pandemic.
The Biden administration is giving homeowners with federally backed mortgages more time before they have to start paying again. The White House announced Tuesday it’s extending a moratorium on foreclosures and the deadline to request mortgage forbearance through June.
More than 600,000 homeowners were set to lose forbearance protections at the end of next month, according to mortgage data provider Black Knight. Now those homeowners can request up to six months of additional relief, and the deadline for new requests was extended through the end of June.
Black Knight economist Andy Walden said the number of homeowners in forbearance has been gradually falling as more people return to work.
“But there will still be a significant number of homeowners struggling with mortgage payments, even when we get to the end of June this year at the current rate of recovery,” Walden said.
When those protections do expire, the Urban Institute’s Laurie Goodman is not expecting a lot of people to lose their homes to foreclosure as happened during the Great Recession.
“Home price appreciation had been very robust before the pandemic and has remained robust throughout the pandemic,” Goodman said. “And the result of that is borrowers have equity in their home.”
If people’s homes are worth more than they owe on their mortgage, Goodman said, they can sell if they need to with their credit intact.
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