The moratorium on foreclosures and evictions for Fannie Mae and Freddie Mac-sponsored mortgages has been extended until at least June 30, according to the Federal Housing Finance Agency.
The FHFA said the moratorium, originally set to expire May 17, has been extended as the U.S. continues to suffer from the economic consequences of the COVID-19 pandemic and resulting lockdown.
“During this national health emergency, no one should be forced from their home,” FHFA Director Mark Calabria said in a statement. “Extending the foreclosure and eviction moratoriums protects homeowners and renters, and provides certainty for families.”
The FHFA’s ban on evictions and foreclosures applies only to properties with government-backed mortgages. That covers about 70% of all home loans, Forbes.com reported.
The decision to extend the moratorium comes after the House of Representatives passed a $3 trillion proposal last week called the HEROES Act, which includes a motion to pause residential evictions for up to a year, and foreclosures for at least six months. The act applies to both government-backed loans and private home loans.
The number of foreclosures in April fell by 75% in April compared to the same month last year, according to data from ATTOM Data Solutions.
“Foreclosure cases dropped dramatically last month following the foreclosure moratorium imposed on lenders holding federally backed mortgages,” said Todd Teta, ATTOM’s chief product officer. “It’s hard to know how much this reflects the virus pandemic because the data doesn’t say whether these were cases caused by very recent job losses or were already filed before that. What can be said is that the drop-off will almost certainly be temporary. And when it’s lifted, we should be able to more clearly measure how deeply the pandemic fallout is affecting homeowners.”