The Federal Housing Administration (FHA) is offering a new COVID-19 HECM Property Charge Repayment Plan to senior homeowners struggling with payments related to their home equity conversion mortgages (HECMs).
“For senior homeowners, recovering from the financial effects of the pandemic may be especially challenging,” Federal Housing Commissioner Julia Gordon said in a release. “The new repayment plan option announced today will give more seniors behind on their property charges the opportunity to fulfill the obligations of their HECM and remain in their homes.”
To be eligible for assistance, borrowers must attest they have been impacted by the COVID-19 pandemic. A verbal statement to the servicer satisfies this element. The servicer then can offer up to five years to repay property charges, such as taxes and homeowners insurance, that the servicer advances on the homeowner’s behalf when the homeowner is unable to make the payments.
The plan also permits borrowers to receive a repayment plan regardless of the dollar amount of property charge payments owed and gives borrowers the opportunity to use jurisdictional homeowner assistance funds. Servicers can offer homeowners a repayment plan up to 60 months, regardless of any prior repayment plan usage. The plan can be offered for up to one year after the end of the COVID-19 national emergency.
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