Reduced monthly payments and help with arrearages are part of the FHA’s plan.

The Federal Housing Administration (FHA) issued updated options for homeowners with FHA-backed mortgages who have suffered financially as a result of the coronavirus pandemic. Representatives from the administration say these streamlined recovery options will help bring homeowners' mortgages up to date and keep people in their homes by allowing mortgage servicers to offer eligible homeowners who cannot resume making their mortgage payments a reduction in the principal and interest portion of their monthly payments. As stated in a press release from the Department of Housing and Urban Development (HUD) and FHA, the changes announced today will provide those most in danger of losing their homes—"including lower income individuals, families of color, and young, first-time homeowners who have disproportionately suffered economic hardships due to the pandemic"—"a path to sustained recovery."  Note that, for homeowners able to resume making their existing monthly mortgage payments, FHA has established a revised COVID-19 Recovery Standalone Partial Claim, which allows mortgage payment arrearages to be placed in a zero-interest subordinate lien against the property that is repaid when the mortgage terminates, usually when the homeowner refinances or sells the home. FHA also reiterated its previous announcement that President Biden’s American Rescue Plan Homeowner Assistance Funds (HAF), administered to the States by the Department of Treasury, may be used in connection with FHA-insured mortgages or subordinate mortgages "as permitted by the jurisdiction’s HAF program" and other requirements.

Source: DS News