President Biden Extends COVID-19 Forbearance Period for FHA, USDA, and VA Loans

Akerman LLP

Akerman LLP

On February 16, 2021, President Biden announced an extension of the foreclosure moratorium and the availability of forbearance relief for Federal Housing Administration (FHA), U.S. Department of Agriculture (USDA), and U.S. Department of Veterans Affairs single-family home loan borrowers experiencing financial hardship due to COVID-19.

For FHA, USDA, and VA borrowers, the foreclosure moratorium is extended through June 30, 2021. Additionally, borrowers who entered into forbearance on or before June 30, 2020, may receive an additional six months of mortgage payment forbearance, in three-month increments. Borrowers who are not in forbearance may now request a COVID-19 forbearance through June 30, 2021.

The actions by President Biden are addressed by the U.S. Department of Housing and Urban Development (HUD) in Mortgagee Letter 2021-05, by the USDA in Release No. 0026.21, and by the VA in Circular 26-21-04 and Circular 26-21-05.

We will continue to monitor for new guidance concerning this forbearance period extension. 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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