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Congress Passes The Cares Act: Mortgage Forbearance Relief for FHA, VA & USDA

The Care Act declares a "Consumer Right to Request Forbearance." Wow... that's a big statement. This matches FHA, VA, and USDA loans to the Fannie and Freddie announcements of March 18.


1. This covers all federally backed loans only. Fannie, Freddie, USDA, RH, FHA, VA... all of them. If they are not federally backed, as in QM or portfolio Jumbo, those are not covered.

2. If a borrower is experiencing financial hardship due to COVID-19, they may request a forbearance for up to 180 days, and they can request an extension of 180 days if done during the first forbearance period.

3. The borrower will not be subject to fees, penalties or interest beyond the interest due as though all payments were made.

4. Lenders are directed not to report late or missed payments to the credit bureau for borrowers in forbearance.

5. Lenders and loan servicers are proscribed from initiating foreclosure or foreclosure-related eviction before May 17, 2020

6. The borrower's sole documentation for hardship is an attestation to the servicer.

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