On Friday, March 27, 2020, the CARES ACT – short for Coronavirus Aid, Relief, and Economic Security Act – was signed into law. Here’s what that means for you:
CARES Act Relief from Foreclosure: Under the CARES Act, a servicer of federally backed mortgage loan (Fannie Mae or Freddie Mac, or owned, insured, or guaranteed by FHA, VA, or USDA) may not:
- initiate any judicial or nonjudicial foreclosure process;
- move for a foreclosure judgment;
- order a foreclosure sale; or
- execute a foreclosure-related eviction after a foreclosure sale.
Put simply: You can’t shelter in place if you don’t have a place. The government wants to make sure that people don’t lose their homes during this national crisis.
The provision lasts for not less than the sixty-day period beginning on March 18, 2020. You don’t have to prove that you have had a COVID-19 hardship. These protections apply to anyone with a federally backed mortgage.
CARES ACT Mortgage Payment Moratorium: If you have a federally backed mortgage, you are entitled to a 180-day break on making mortgage payments. You can request to extend for another 180 days. Yes, you read this right – you may not have to pay your mortgage for a year.
The law says that all you need to do to qualify is say that you were affected by COVID-19. The banks are not allowed to ask you for any additional documentation to prove your hardship. While you are not paying, no additional fees, penalties, or interest shall accrue on your account beyond what you would normally have.
To determine if a mortgage loan is “federally-backed,” refer to the links in our previous newsletter. If you are having trouble, send us an email, and we will look it up for you.
YOUR RIGHTS UNDER THE CARES ACT MUST BE RESPECTED: The CARES ACT is a federal law that creates new protections for homeowners with federally backed mortgages. If you have a federally backed loan, your lender must respect your rights under this new law. If they don’t we’re here to hold their feet to the fire.
As COVID-19 continues to impact our country, we will continue bringing you the latest developments, guidance, and information. Stay healthy and safe!!
The Law Office of Malcolm E. Harrison