Impact of America Rescue Plan on Mortgage Servicing operations
Impact of America Rescue Plan on Mortgage Servicing operations COVID-19 had an unprecedented impact on housing affordability for homeowners & renters alike. In order to keep the economy afloat - Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was brought into effect. One of the key provisions of CARES Act was a - 12 months forbearance period to borrowers of federally backed loans. This provided much needed mortgage relief to homeowners albeit at a higher risk of default. As the mortgage relief period headed to a close in March 2021, President Joe Biden announced the America Rescue Plan early this year to continue this beyond March. The plan not only allocates $1.9 trillion towards various state assistance programs but also extends the COVID-19 foreclosure & forbearance protection for homeowners. Soon after this announcement, the Federal Housing Finance Agency (FHFA) extended the forbearance period for Fannie Mae and Freddie Mac loans to up to 18 months. Undoub