The Department of Housing and Urban Development's 60-day foreclosure halt for Federal Housing Administration borrowers is too short to help reverse mortgage borrowers, a letter from consumer groups stated.
"HUD's 60-day foreclosure moratorium was a crucial first step, but does anyone really believe older homeowners will have recovered from this crisis within 60 days?" said National Consumer Law Center attorney Sarah Mancini in a press release. "Further action is needed to ensure that this older population, which is most vulnerable to the virus, will maintain stable housing and not end up facing unnecessary foreclosures."
New challenges for Home Equity Conversion Mortgage borrowers from the fallout from COVID-19 include defaults on property charges, defaults on existing repayment plans and the inability to obtain legal assistance and/or appear in court.
"We know that the aftermath of this crisis will extend well beyond 60 days, especially the financial consequences," a coalition of over 40 groups said in a letter sent to HUD Acting Deputy Secretary Brian Montgomery. "As a result, we urge HUD to extend the moratorium to six months and to consider extending further as needed. We hope this timeframe will give borrowers and mortgagors the time they need to address the payment issues that will arise."
The regulation established standards for investors who own less than a quarter of an institution. Banks are getting more time for implementation as they focus on effects of the COVID-19 pandemic.
The Internal Revenue Service is now accepting email and digital signatures on tax documents to make it easier for tax professionals and taxpayers to communicate with the agency during the novel coronavirus pandemic.
With coronavirus driving more merchants to promote electronic payments over cash — and contactless payments over cards — many are still asking their customers to share a potentially virus-laden pen to sign a receipt or screen at the point of sale.
HUD also needs to clarify if the latest mortgagee letter extends the timeline for nonborrowing spouses to submit their loan to the Mortgagee Optional Election program by 60 days, the coalition said. Under the 2019 mortgagee letter that established the MOE, the deadline was supposed to be March 21.
"Depending how long the public health emergency lasts, a further extension [of the MOE deadline] may be necessary," the coalition's letter said.
The groups, led by the NCLC, also ask HUD to direct servicers not to pay property taxes on behalf of reverse mortgage borrowers if the taxing authority has an extension or foreclosure moratorium. If an advance was made, allow an extra six months for borrowers to pay back the funds.
Plus, the agency must expand access to loss mitigation for qualified homeowners and allow for new repayment plans when borrowers default during the national emergency, the groups said.
