The Coronavirus Aid, Relief and Economic Security Act of 2020 was recently enacted by the federal government to provide limited financial relief due to the COVID-19 pandemic. According to interpretations of the Act by at least one title insurer, part of the Act put in place a moratorium on residential foreclosures for borrowers for certain federally backed mortgages on certain single and multi-family family homes.
The Act only applies to federally backed mortgages which are insured or guaranteed by Federal Housing Administration, the Veterans Administration, the United States Department of Agriculture, and loans that are owned or securitized by the Federal National Mortgage Association, commonly known as Fannie Mae, or the Federal Home Loan Mortgage Corporation, commonly
known as Freddie Mac. The Act attempts to prohibit the initiation of a foreclosure, entry of a judgment of foreclosure or an order permitting a foreclosure sale, and an eviction or foreclosure sale following a foreclosure sale for loans subject to the Act through May 17, 2020. The Act also allows a borrower to request forbearance on loans subject to the Act for various periods of time. Importantly, at present, it appears the moratorium does not apply to vacant or abandoned property or private bank loans.
Whether you are a lender or borrower, you should have experienced counsel advise you of all the various options and legal rights available depending on the specific facts and circumstances of your situation before taking any course of action.
Portions of this
article were republished with permission from The Fund. This article is for informational purposes only and you should seek professional legal advice before taking any action based on this article. Further, this information is subject to change due to the rapidly changing legal, political and business environment