Early in the COVID-19 pandemic, the federal government, most states, some localities, and many mortgage lenders put foreclosure moratoriums into effect. But now, the federal foreclosure suspension and the vast majority of state foreclosure moratoriums have expired. Still, in a few circumstances, and depending on your loan, you might be eligible for a pause in foreclosure proceedings.
Also, other kinds of mortgage help are available to help you stop a foreclosure—like getting a loan modification or participating in foreclosure mediation—even if you don't get a foreclosure moratorium.
A "foreclosure moratorium" is a temporary stop in initiating or continuing foreclosures.
When the coronavirus outbreak happened, the federal government and most states put a hold on foreclosures. But, again, widespread foreclosure suspensions have mostly ended.
The federal Coronavirus Aid, Relief, and Economic Security (CARES) Act initially imposed a foreclosure moratorium for federally backed mortgage loans starting March 18, 2020.
"Federally backed mortgage loans" include:
This moratorium was extended many times during the COVID-19 pandemic but finally expired on July 31, 2021.
With only a few exceptions, most state-imposed foreclosure moratoriums, which also covered other kinds of loans, have also ended.
To determine if a foreclosure moratorium still applies to your area or loan type, check online, talk with a local lawyer, speak with a HUD-approved housing counselor, or contact your loan servicer.
For specific information about what's going on in your foreclosure, contact the attorney or trustee handling the foreclosure. You can also call your loan servicer for information.
The federal government hasn't given any indication that it will enact a foreclosure moratorium extension in 2023 for federally backed mortgage loans. Likewise, the U.S. Department of Housing and Urban Development (HUD) (which oversees the FHA), VA, and USDA haven't announced any plans to set another moratorium for foreclosures.
Only a couple of states extended their foreclosure moratoriums beyond the summer of 2021.
However, if you have a Fannie Mae or Freddie Mac loan and your mortgage servicer learns that you've applied to your state's Homeowner Assistance Fund program, the servicer must suspend any foreclosure activity for up to 60 days. To find out if Fannie Mae or Freddie Mac owns your mortgage loan, use Fannie's mortgage loan lookup tool and Freddie Mac's loan lookup tool. You can also contact your servicer to ask if Fannie Mae or Freddie Mac owns your loan, or call 800-232-6643 (Fannie Mae) or 800-373-3343 (Freddie Mac).
And a few states provide a foreclosure moratorium if you apply to a Homeowner Assistance Fund program.
On March 11, 2021, President Joe Biden signed the American Rescue Plan Act of 2021 into law. This Act created a Homeowners Assistance Fund, a mortgage-relief program, to provide $10 billion to the states to help struggling homeowners. The states, plus the District of Columbia, set up various programs with their allocated funding to distribute the money and assist financially-distressed homeowners.
These state-run programs help homeowners pay overdue and future mortgage payments and other housing costs, like past-due utility costs, property taxes, homeowners' association fees, and more.
Even if you don't have a Fannie Mae or Freddie Mac loan or live somewhere that doesn't provide a foreclosure suspension if you apply to a Homeowner Assistance Fund program, the Consumer Financial Protection Bureau (CFPB) published a statement addressing this issue. It advised servicers to ensure mortgage borrowers aren't improperly referred to foreclosure while seeking help from a Homeowner Assistance Fund program.
The CFPB, which oversees certain lenders, also emphasized that foreclosing on a borrower while a Homeowner Assistance Fund application is pending "will merit increased scrutiny."
Most COVID-related borrower protections expired in 2021. In addition to the federal foreclosure moratorium ending, a CFPB rule that made it mandatory for loan servicers to do more to help homeowners affected by COVID-19 expired on December 31, 2021.
So, while most foreclosures stopped in 2021, foreclosure numbers rose after the moratorium and rule expired. Another reason for rising foreclosure numbers is many people exiting their COVID-19 forbearances.
According to ATTOM Data Solutions, foreclosure activity in the United States in late 2022 continued to increase, nearing pre-pandemic levels. Its report revealed that 31,836 properties had foreclosure filings in September 2022, down 8% from the previous month but up 62% from September 2021.
Mortgage help is available, even though a sweeping foreclosure moratorium extension isn't likely. If you're behind in mortgage payments, you might qualify for an alternative that will allow you to save your home. Or you might be eligible for an option where you give up the property without going through a foreclosure.
After you submit a loss mitigation application to your loan servicer, you might receive another kind of offer allowing you to stay in your home, like a repayment plan, loan modification, or payment deferral.
Or, if you'd like to leave the property without going through a foreclosure, you might be able to complete a short sale or deed in lieu of foreclosure.
Federal law usually prevents the servicer from starting a foreclosure until you're more than 120 days delinquent on the loan. You can use this time to work out a way to avoid foreclosure.
Also, under federal law, if you send the servicer a complete loss mitigation application before foreclosure starts, the servicer can't start the foreclosure unless and until:
If you're already in foreclosure and you send the servicer a complete application after foreclosure starts (but more than 37 days before a foreclosure sale), the servicer can't ask a court for a foreclosure judgment or order of sale, or conduct a foreclosure sale, until one of the three conditions mentioned above has been satisfied.
But the servicer generally doesn't have to review more than one loss mitigation application from you unless you bring the loan current after applying.
State foreclosure laws require servicers to complete specific steps to foreclose. Your state's laws, along with the federal and contractual rights you get in a foreclosure, might provide you with significant foreclosure protections.
You might be able to delay a foreclosure or work out a way to avoid it by going to foreclosure mediation, if available.
You can stop a foreclosure in its tracks by filing for bankruptcy—even at the last minute. After filing a bankruptcy petition, an "automatic stay" immediately goes into effect. The stay acts as an injunction prohibiting the bank from foreclosing on your home or otherwise trying to collect its debt. So, any foreclosure activity must stop.
Filing for Chapter 7 bankruptcy will probably just delay a foreclosure, while you might be able to stop a foreclosure with a Chapter 13 bankruptcy. Talk to a bankruptcy attorney to learn if bankruptcy makes sense for you.
To learn more about your legal rights in a foreclosure, consider talking to a foreclosure attorney. A lawyer can advise you about foreclosure alternatives, your rights in a foreclosure under federal law, tell you about any state laws that protect you in the process, and help you fight a foreclosure, if you choose to do so.
If you need more information about loss mitigation options, a HUD-approved housing counselor can explain the alternatives to you in more detail and help you deal with your mortgage servicer. Go to hud.gov to find a housing counseling agency near you, or call toll-free 800-569-4287.