HUD, Fannie Mae, and Freddie Mac Suspend Foreclosures and Evictions for 60 DaysDuring a COVID-19 press briefing at the White House on March 18, 2020, President Donald Trump announced that the Department of Housing and Urban Development (HUD) will temporarily suspend “all foreclosures and evictions.” The president made this announcement to provide “immediate relief” to homeowners and renters struggling to make rent and mortgage payments. The president’s announcement to suspend evictions and foreclosures is similar to the eviction and foreclosure moratoriums already implemented by a number of states and large municipalities, including New York, California, Denver, and San Antonio.

Following the president’s announcement, HUD released Mortgagee Letter 2020-04, which imposes a 60-day moratorium on evictions and foreclosures for all FHA-insured Title II Single Family forward and reverse mortgages. The moratorium announced in the mortgagee letter requires mortgagees to comply with the following on properties secured by an FHA-insured Single Family mortgage:

  • Suspend the initiation of foreclosures and the completion of foreclosures in process for 60 days
  • Suspend evictions of persons from properties for 60 days

The mortgagee letter also provides a 60-day extension to the deadlines of the first legal action and reasonable diligence timelines. Kathleen Kraninger, director of the Consumer Financial Protection Bureau, issued a statement commending HUD’s action and expressing support for “appropriate flexibilities” to benefit consumers.

In conjunction with HUD’s announcement, the Federal Housing Finance Agency (FHFA) directed Fannie Mae and Freddie Mac (the “enterprises”) to suspend foreclosures and evictions for at least 60 days for all enterprise-backed single-family mortgages. FHFA also reminded borrowers who are having difficulties paying their mortgage that they should contact their mortgage servicers to discuss options to keep their mortgage current.

Mortgagees with a mortgage portfolio including FHA-insured Single Family forward or reverse mortgages should immediately begin work to suspend foreclosures and evictions as required by Mortgagee Letter 2020-04.

Although many mortgage companies and portfolios are not directly covered by the HUD letter, additional government announcements may be forthcoming. Regulated mortgage entities must stay alert to what may become fast-changing guidance in this area – guidance that will likely have profound business, operational, and regulatory implications.

Bradley will be discussing this new guidance by HUD and FHFA in an upcoming webinar. The information on how to access the webinar will be added to this blog post as soon as it is scheduled.

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Photo of James W. Wright Jr. James W. Wright Jr.

Jay Wright is a partner in the firm’s Banking and Financial Services and Litigation practice groups. Jay has earned his Accredited Mortgage Professional (AMP) designation through the Mortgage Bankers Association (MBA), and is one of a small number of lawyers who have achieved…

Jay Wright is a partner in the firm’s Banking and Financial Services and Litigation practice groups. Jay has earned his Accredited Mortgage Professional (AMP) designation through the Mortgage Bankers Association (MBA), and is one of a small number of lawyers who have achieved this status.

Jay’s practice focuses on financial services litigation and regulation, and he is actively involved in lawsuits and disputes across the country representing companies involved in a wide array of state and federal law claims. His representation includes general defense of various claims against financial institutions, mortgage companies, and other commercial entities. Many of these claims involve allegations of wrongful foreclosure proceedings or violations of the Truth in Lending Act (TILA), the Real Estate Settlement Procedures Act (RESPA), and Federal Housing Administration (FHA) regulations, as well as various deceptive trade practices claims under state law.

Photo of Michael Gordon Michael Gordon

Michael Gordon is an accomplished consumer finance lawyer with more than 20 years of experience as a law firm partner, senior federal regulator, and fintech general counsel. His practice includes consumer finance and fintech, banking and bank partnerships, consumer and commercial credit, payments…

Michael Gordon is an accomplished consumer finance lawyer with more than 20 years of experience as a law firm partner, senior federal regulator, and fintech general counsel. His practice includes consumer finance and fintech, banking and bank partnerships, consumer and commercial credit, payments, regulatory strategy, risk management and corporate governance matters for a range of clients. Michael is a practical, business-focused lawyer with wide-ranging experience in private practice, government, and as a client. He has established a reputation for helping financial institutions and service providers anticipate and respond to a complex and ever-changing regulatory environment. View articles by Mike.

Photo of Austin Holland Austin Holland

Austin Holland’s practice focuses on regulatory compliance matters, government enforcement actions, and financial services litigation. He has represented clients in a variety of matters, but his practice is particularly focused on issues with an emphasis on matters related to housing.

Prior to…

Austin Holland’s practice focuses on regulatory compliance matters, government enforcement actions, and financial services litigation. He has represented clients in a variety of matters, but his practice is particularly focused on issues with an emphasis on matters related to housing.

Prior to joining Bradley, Austin worked for the U.S. Department of Housing and Urban Development in the Office of Litigation, where he handled matters related to affordable housing, reverse mortgages, fair housing, bankruptcy, foreclosures, grant recaptures, rulemaking, religious discrimination, and the Appointments Clause of the U.S. Constitution.