Early in the COVID-19 pandemic, the federal government, most states, some localities, and many mortgage lenders put foreclosure moratoriums into effect.
During 2020 and 2021, at the height of the COVID-19 pandemic, foreclosure moratorium extensions were common. But now, the federal foreclosure suspension and the vast majority of state foreclosure moratoriums have expired.
Still, in a few circumstances, and depending on what kind of loan you have, 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 entering into a COVID-19 forbearance, getting a loan modification, or participating in foreclosure mediation—even if you don't get a foreclosure moratorium.
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 60-day 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 places, like Vermont, provide a foreclosure moratorium if you apply to a Homeowner Assistance Fund program.
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 that they must 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 HAF 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 started to rise after the moratorium and rule expired.
Another reason for rising foreclosure numbers is that many people are 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.
While the COVID-19 national emergency declaration remains in place, homeowners with a federally backed mortgage loan can get a payment forbearance by simply asking for one and affirming a coronavirus-related financial hardship.
Other relief is also available, depending on what entity owns or guarantees your loan, like Fannie Mae, Freddie Mac, FHA, or VA. Even if your loan isn't federally backed, your servicer might offer a forbearance or another form of relief, like a loan modification (see below), if the COVID crisis has financially impacted you.
After you submit a loss mitigation application to your loan servicer, you might receive another kind of offer that will allow you to stay in your home, like a repayment plan, loan modification, or payment deferral.
Alternatively, if you can come up with the funds, you could redeem your home before or, depending on state law, after the foreclosure, or complete a loan reinstatement.
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.
In most cases, federal law 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.
A couple of states, including Connecticut and New Mexico, have passed COVID-specific foreclosure laws to help homeowners avoid foreclosure. Other states have foreclosure protection laws already in place.
You might be able to delay a foreclosure or work out a way to avoid it by going to foreclosure mediation, if available.
Depending on the circumstances, you might consider initiating a lawsuit to stop a nonjudicial foreclosure or challenging a judicial foreclosure in court.
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.
If your loan is owned or insured by Fannie Mae, Freddie Mac, FHA, VA, or the USDA's Rural Housing Service, you can contact that entity to find out about foreclosure relief.