Industry News

HUD extends foreclosure moratorium for FHA-insured home loans

Homeowners must formalize repayment plans by March 31

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The Housing and Urban Development Department today announced it has directed all FHA-approved lenders to extend a moratorium on foreclosures of FHA-insured mortgages another 120 days. The previous moratorium on foreclosures was in effect through Feb. 28, and the HUD decision extends that foreclosure moratorium for FHA-insured homeowners until June 30, 2006, for those homeowners who establish a plan by March 31 to pay off the delinquent mortgage debt. "By preventing the possibility of foreclosure for another four months, we want to ease the pressure on FHA-insured borrowers as they try to put their lives back together in the aftermath of the storms," said HUD Secretary Alphonso Jackson. The extended moratorium applies to all FHA-insured loans in presidentially declared disaster areas eligible for individual assistance as a result of Hurricanes Katrina, Rita and Wilma. To be eligible for the full 120-day moratorium, borrowers must make a written commitment to work with their lender on a...