3 reasons why 2021 could be a record year.
An extension, followed by another extension, and then another. No one should be surprised. Certainly, no one wants to see Americans evicted from their home and left scrambling to find a new roof over their head. Therefore, mortgage forbearances and extended deadlines seemed prudent, however, they will come at a cost.
Yesterday HUD announced FHA’s fourth extension for foreclosures and evictions since the COVID-19 pandemic hit early this spring. What does this have to do with reverse mortgages? Ironically it may actually make 2021 a prosperous year for our industry.
Homeowners with loans backed by FHA must request forbearance from their loan servicer on or before February 28, 2021- a deadline that was set to expire on December 31, 2020. HUD’s press release reads, “FHA requires mortgage servicers to provide up to six months of COVID-19 forbearance when a borrower requests this assistance, and up to an additional six months of COVID-19 forbearance for borrowers who request an extension of the initial forbearance. Borrowers needing assistance must engage with their servicer to obtain an initial COVID-19 forbearance on or before February 28, 2021.” However, there’s no application deadline for those with loans backed by Fannie or Freddie until these GSE’s decide to stop offering extensions.
This means homeowners unable to make any or part of their contractual mortgage payments could conceivably postpone payments until February of 2022, that thanks to the initial six-month forbearance and subsequent six-month extension if needed.
How could this impact reverse mortgage lending? Read More
1 comment
Banner years are events and celebrations of the second decade of the HECM program. For now it is good enough that we are seeing significant increases.