A new rule proposed by the Consumer Financial Protection Bureau (CFPB) seeks to prevent a wave of foreclosures as some pandemic protections for homeowners are set to expire. According to CNBC, the rule, which would apply to all mortgages federal & private, will prevent mortgage servicers from initiating a foreclosure against delinquent borrowers through December 31, 2021. The CFPB says 1.7 million borrowers could be at risk of foreclosure when the forbearance program ends in September and this number is higher than anything mortgage servicers have ever seen. The proposed rule will still need final approval. Stay tuned.
“CFPB’s approach to expediting and simplifying the recasting of loans for those in forbearance is not only a good move, it will be a critical move in helping to stabilize the housing industry, community housing values, and the short and long-term benefit of service providers as well as individual homeowners. In short this is a win all around for those who have felt the brunt of the Covid-19 pandemic’s economic fallout.” Said Charles Tassell, COO of National REIA.