The Biden Administration will extend the country’s foreclosure moratorium through the end of June for those defaulting on federally-backed mortgages.
According to a Tuesday announcement from the White House, protections for homeowners set to expire in March will now extend through June 30. This includes a moratorium on foreclosures, as well as the enrollment period for mortgage forbearances, which allow homeowners to pause or reduce their payments.
Borrowers that enter the forbearance program before June 30 will also be eligible for an additional six months of forbearance.
“These critical protections were due to expire in March, leaving many at risk of falling further into debt and losing their homes,” the announcement reads. “Now, homeowners will receive urgently needed relief as we face this unprecedented national emergency. Today’s action builds on steps the President took on Day One to extend foreclosure moratoriums for federally guaranteed mortgages.”
Currently, 2.7 million homeowners with federally-backed home loans are in COVID-19 forbearance plans. The extensions will make forbearance options available to to the estimated 11 million mortgages backed by the federal government.
The extensions are also meant to address racial disparities in mortgage payments during the pandemic. The announcement pointed to data from the Urban Institute that found 28% of Black homeowners did not pay or deferred on their mortgage payment in May compared to 9% of white homeowners.
“The health and economic costs of this crisis have not been evenly felt, a pattern repeated over the course of the pandemic,” the announcement reads. “Extending forbearance policies will provide critical support to homeowners of color, who make up a disproportionate share of borrowers with delinquent loans and loans in forbearance due to COVID-related hardship.”
Last month, Biden also asked federal agencies to extend the country's moratorium on evictions for renters through at least March.
In Minnesota, Gov. Tim Walz recently asked the Legislature to extend the state's own moratorium as part of its continued COVID-19 response.