- Office of Attorney General Maura Healey
Media Contact for AG Healey Calls on Federal Government to Provide a Long-Term Solution for Homeowners Affected by COVID-19
Boston — Attorney General Maura Healey today joined a bipartisan coalition of 34 attorneys general in calling on the federal government to provide immediate relief to homeowners affected by COVID-19.
In letters sent today to the Federal Housing Finance Administration (FHFA) and the Department of Housing and Urban Development (HUD), the attorneys general ask the federal agencies to take steps to ease the financial burden on homeowners and clarify guidance issued as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act passed on March 27.
“The CARES Act is meant to provide immediate relief – instead, it’s created anxiety and confusion for homeowners and put them at risk of foreclosure,” said AG Healey. “We need clarity that homeowners are actually getting the relief they need during this crisis.”
As part of the CARES Act, FHFA and HUD adopted processes for borrowers who have been affected by COVID-19 to enter forbearance plans that allow borrowers to pause mortgage payments for a limited period of time. Under the current CARES Act forbearance plans, borrowers must either repay missed payments in a lump sum after the forbearance period ends or apply for a loan modification or other program to address the missed payments after the forbearance period expires.
The attorneys general write that because an unprecedented number of borrowers would be exiting forbearance plans at the same time and could be in need of significant financial assistance, FHFA and HUD should allow mortgage servicing companies to move missed mortgage payments to the end of borrowers’ loan terms. This approach is consistent with the forbearance requirements in a recently passed Massachusetts law that provides for a moratorium on evictions and foreclosures during the COVID-19 emergency.
The attorneys general also ask that the agencies expand eligibility for disaster relief loss mitigation programs so that borrowers are not unnecessarily denied loan modification relief. In addition, the letter confirms with the agencies that under the CARES Act and agency policies, there is currently a moratorium on all foreclosures and evictions actions during this crisis.
The CARES Act applies only to federally backed mortgages, which make up approximately 62 percent of the mortgage market. Massachusetts’ landmark Act Providing for a Moratorium on Evictions and Foreclosures during the COVID-19 Emergency passed this week provides strong protections to Massachusetts homeowners and tenants.
Visit the AG’s COVID-19 resource page for information about how the AG’s Office can provide support during this crisis.
These letters AG Healey joined today were led by the Iowa attorney’s general office, and also joined by California, Colorado, Connecticut, District of Columbia, Delaware, Florida, Hawaii, Idaho, Illinois, Maine, Maryland, Michigan, Minnesota, Montana, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Dakota, Tennessee, Vermont, Virginia, Washington, West Virginia, and Wisconsin