Categories: HousingMortgage

Trump announces moratorium on foreclosures due to coronavirus

U.S. President Donald Trump announced Wednesday a full moratorium on foreclosures for homeowners with mortgages backed by Fannie Mae, Freddie Mac and the Federal Housing Administration.

The Department of Housing and Urban Development has also provided help, saying it will suspend all evictions of public housing residents.

It’s said that FHA loans and public housing residents account for more than 9 million U.S. households, while Fannie and Freddie back the vast majority of single-family mortgages in the country. The moratorium on those mortgages has currently been set at 60 days, but could be extended.

Trump announced the measure as part of the government’s response to the economic turmoil that’s been caused by the spread of the coronavirus, which causes the COVID-19 respiratory disease. U.S. Treasury Secretary Steve Mnuchin recently said it could cause unemployment to rise to 20%.

Fannie Mae and Freddie Mac act as guarantors of around 97% of all U.S. mortgages, which are bought and bundled into bonds called mortgage-backed securities.

As such, it means the moratorium will apply to the vast majority of people with a mortgage. Those whose mortgages aren’t backed by Freddie or Fannie are likely to be condo owners, subprime borrowers or owners of expensive luxury homes.

The moratorium is intended to stave off a glut of foreclosures like we saw in the 2008 housing crisis, which led to millions of homeowners defaulting en masse and caused a massive increase in the availability of homes on the market.

As for the HUD’s moratorium, this applies to over a million households, the majority of which are likely to be elderly and disabled persons. It doesn’t apply to those who hold housing vouchers, however.

Of course, while this action will protect millions of Americans, there are millions more living in private rental homes that remain vulnerable to eviction should they be unable to pay their rent. It’s not clear yet if the government will provide any support to people in this category.

Some cities have however announced private moratoriums on evictions that range from two weeks to indefinitely, including Los Angeles, Miami, New York and San Francisco.

Mike Wheatley

Mike Wheatley is the senior editor at Realty Biz News. Got a real estate related news article you wish to share, contact Mike at

Recent Posts

Consumer confidence in housing falls to lowest point in 11 years

Fannie Mae said in a monthly survey released this week that consumer’s confidence in the…

11 hours ago

Will Josh Hall Become the New Face of Real Estate?

Do you know who Josh Hall is? If you don't you soon will do. Josh…

16 hours ago

How to Become a First-Time Landlord

Becoming a landlord is one of the easiest ways to invest in real estate. If…

23 hours ago

SEO: How to Optimize Your Real Estate Website

Every savvy real estate professional knows that the bulk of your marketing and brand-building efforts…

2 days ago

Ask Brian: When You Marry Someone Do You Marry Their Debt?

Ask Brian is a weekly column by Real Estate Expert Brian Kline. If you have…

2 days ago

What Do Real Estate Attorneys Do For Sellers?

When an attorney for real estate represents a seller, they could be involved in drafting…

3 days ago