During the first two weeks of social distancing in March, over 10 million people filed for unemployment benefits across the United States. On March 27, Congress passed the CARES Act, which provides people an additional $600 a week beyond what they will receive by their state unemployment. This extra money is vital, but it is not enough to cover all costs during this unprecedented economic decline. To help mitigate this decline in employment from turning into a homeownership crisis, the CARES Act provides two protections. The first protection is a moratorium, temporary prohibition, on new foreclosures. The second protection is people can contact their mortgage servicer to request a forbearance on paying their mortgage payments. Forbearance means that borrowers can request to either pause payment or reduce your payments for a period of time. However, these protections only apply to loans that are owned by a federal agency or entity which can be any one of the following:
- U.S. Department of Housing and Urban Development (HUD)
- U.S. Department of Agriculture
- Federal Housing Administration
- U.S. Department of Veterans Affairs
- Fannie Mae
- Freddie Mac
Not all loans are federally owned; thus, not everyone who has a mortgage and is economically affected by COVID-19 will qualify for protections under the CARES Act. If you don’t qualify under the CARES Act, you should still contact your loan servicer to find out what they can do to help you during this time.
The Fair Housing Act protects people against discrimination in the mortgage arena. Servicing mortgages fall under the jurisdiction of the Fair Housing Act. A mortgage servicer cannot discriminate against anyone on the basis of:
- Color
- Race
- National Origin
- Gender
- Familial Status
- Disability
- Religion
A mortgage servicer cannot offer two similarly situated borrowers, different forbearance options because one borrower is White and one is Black or because one borrower is male and the other is female. If you feel that you have experienced mortgage lending discrimination when requesting your forbearance, you can file a complaint with HUD. You can also reach out to our team at NCRC: Sara Oros, Program Coordinator, Fair Housing/Fair Lending
Anneliese Lederer is NCRC’s Director of Fair Lending and Consumer Protection
Photo by Precondo CA on Unsplash
