What can I do to Avoid Foreclosure During the COVID-19 Pandemic?

If you are struggling to make your mortgage payments as a result of the COVID-19 pandemic, you should know that you are not alone. While recognizing that many other Americans like you are struggling does not always bring much comfort, it does mean that there may be more options that you can consider in order to avoid foreclosure. There are some options for homeowners with federally backed mortgages, and there may be additional options for homeowners who do not have government-backed mortgages. Even if you have no options through your lender or mortgage servicer, other possibilities might be able to help you to stay in your home during this incredibly difficult time.

If you are at risk of losing your home, you should seek advice from an Oak Park foreclosure defense attorney as soon as possible. The quicker we can begin working on your case, the better your chances may be to avoid foreclosure. In the meantime, the following are just some of the options you might have when it comes to avoiding foreclosure.

You Have Forbearance Rights With a Federally Backed or GSE-Backed Mortgage

As the Consumer Financial Protection Bureau (CFPB) explains, the Coronavirus Aid, Relief, and Economic Security (CARES) Act provides mortgage forbearance for federally backed and Government Sponsored Enterprise (GSE) backed mortgages. The federal law has to separate protections for homeowners with these types of mortgages:

• Lenders are prevented from foreclosing on your home until at least December 31, 2020, and it is possible that those protections will extend into 2021; and
• Homeowners can request and obtain an additional forbearance of up to 180 days if they have experienced a financial hardship as a result of the COVID-19 pandemic.

In order to be eligible for an additional 180 days forbearance, you will need to contact your loan servicer in order to request the additional forbearance. You will not face any additional fees, penalties, or interest beyond what is already scheduled. You also can request this additional forbearance without having to submit any additional paperwork beyond your claim.

Talk to Your Lender or Servicer About a Forbearance

Many banks granted forbearances for homeowners whose mortgages were not federally or GSE-backed at the start of the pandemic. Although many of those forbearances have expired, it is always possible that your lender or servicer will work with you on payments if you are experiencing a financial hardship and could even grant an additional forbearance.

Learn About Chapter 13 Bankruptcy Options

If you do not have any forbearance options and you are already at risk of foreclosure, one option that could benefit you is Chapter 13 bankruptcy. If you are eligible for Chapter 13 bankruptcy, the automatic stay can prevent the foreclosure process from going any further and can allow you to reorganize your debts and get caught up on your mortgage. A bankruptcy lawyer can tell you more about how this works.

Seek Advice from an Oak Park Foreclosure Defense Attorney

If you have questions about avoiding foreclosure, one of our experienced Oak Park foreclosure defense attorneys can assist you. Contact the Emerson Law Firm for more information.


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Coming Foreclosure “Wave” Will be Different From 2008
Foreclosure Surge: Question is Not When, But How Much?