Similarly, the Federal Housing Finance Agency (“FHFA”) directed Fannie Mae and Freddie Mac to suspend foreclosures and evictions for 60 days and also, promulgated temporary guidelines (the “Guidelines”) to enable mortgage servicers to assist borrowers. Effective immediately, the Guidelines are expanding the eligibility for forbearance plans to include those impacted by COVID-19. Forbearance plans provide borrowers with payment relief for up to 12-months and may suspend borrower late charges and penalties. The Guidelines further provide that, for those borrowers receiving a forbearance plan in response to COVID-19, mortgage servicers must initiate contact with the borrower at least 30-days prior to the expiration of the forbearance plan and evaluate each case to determine whether the borrower is eligible for a post-forbearance loan modification.
Additionally, the Guidelines direct mortgage servicers to suspend the reporting of mortgage loan statuses to credit bureaus during active forbearance plans or other repayment plans, so long as the delinquency is related to a hardship resulting from COVID-19.
Similarly, state authorities are issuing orders and implementing policies to assist their citizens in the wake of the COVID-19 pandemic, as follows:
California: On March 16, 2020, Governor Gavin Newsom signed Executive Order No. 28-20, which temporarily suspends any state law or provision preempting or otherwise limiting a local government from exercising its police power to impose restrictions on foreclosure actions. Unless otherwise extended, the suspension of the aforementioned state laws and provisions shall remain in effect through May 31, 2020.
Executive Order No. 28-20 further requests that financial institutions implement an immediate and indefinite moratorium on foreclosures and related evictions with respect to borrowers experiencing financial difficulties caused by the COVID-19 pandemic.