The Biden administration on Friday rolled out new measures to prevent seizures linked to the pandemic.
The new measures apply to FHA, VA, Fannie Mae, Freddie Mac and USDA loans.
According to the Urban Institute, about 75% of new home loans are guaranteed by the federal government.
Paula Powers-Watts, executive director of the Credit Counseling Center in Bucks County, began doing this work during the 2008 recession.
“I have so many homeowners calling me regularly to call, check in, see if these programs are successful,” Watts said.
“I would say that this pandemic that we went through was a little more serious than the previous collapse of the economy.”
The changes affect those who have deferred their mortgage payments.
If your income has returned to normal income, the partial claim has been extended.
“And that partial claim takes the overdue balance – whatever it is – and makes it due at the end of the loan,” Watts said.
And for those who have seen a loss of income, new measures will be implemented to offer an approximate 25% reduction in monthly payments through refinancing, extended terms and lower rates.
“We’re talking about lowering interest rates, lengthening loan terms. So there’s a lot of good stuff in the mix here,” Watts said.
Currently, about three percent of active mortgages are seriously past due.
“Jobs are opening up, things are changing, so keep your eyes open, ears open,” Watts said.
The goal is not to repeat the same mistakes of the 2008 recession and give homeowners the opportunity to do their bills.
The new tools should be available in the coming months.
If you have any questions, the first thing you want to do is contact a free HUD-approved counseling agency, to start looking at your options.
You should also call your mortgage company and let them know that you are fighting to keep your home.