Foreclosure moratorium extended to February 28 2021

The following news release was posted on the Federal Housing Finance Agency site.  It is important to note that this does NOT apply to every mortgage everywhere.  Many mortgages are owned by Fannie Mae or Freddie Mac, but not all of them. Still, this moratorium and possibility for forbearance will help many people.  See at the bottom of this post for instructions on how to look up your mortgage.

"1/19/2021

​Washington, D.C. – Today, the Federal Housing Finance Agency (FHFA) announced that Fannie Mae and Freddie Mac (the Enterprises) will extend the moratoriums on single-family foreclosures and real estate owned (REO) evictions until February 28, 2021.  The foreclosure moratorium applies to Enterprise-backed, single-family mortgages only. The REO eviction moratorium applies to properties that have been acquired by an Enterprise through foreclosure or deed-in-lieu of foreclosure transactions. The current moratoriums were set to expire on January 31, 2021.

“To keep our communities safe, and families in their homes during the COVID-19 pandemic, FHFA is extending Fannie Mae and Freddie Mac's foreclosure and eviction moratorium," said Director Mark Calabria. 

Currently, FHFA projects additional expenses of $1.4 to $2 billion will be borne by the Enterprises due to the existing COVID-19 foreclosure moratorium and its extension. FHFA continues to monitor the effect of the foreclosure and eviction moratorium on borrowers, the Enterprises and their counterparties, and the mortgage market and extend or sunset its policies based on the data and health risk.

The Enterprises continue to offer comprehensive loss mitigation programs for borrowers with eligible hardships. These programs, which were established pre-pandemic and have helped more than 4.5 million families stay in their home, will remain available even when COVID-19 forbearance flexibilities end.

Under the comprehensive loss mitigation programs, qualified borrowers with a financial hardship that affects their ability to pay their mortgage may be eligible for temporary forbearance of up to 12 months, whether their hardship was caused by COVID-19 or not. Qualified borrowers can also obtain loan modifications to assist their ability to resume regular monthly payments once their hardship is resolved."

According to www.https://www.makinghomeaffordable.gov 

"To find out if Fannie Mae or Freddie Mac owns your loan, use their respective loan lookup tools or contact your mortgage company to ask who owns your loan. 

FANNIE MAE, 1-800-2FANNIE (8am to 8pm EST), KnowYourOptions.com/loanlookup 

If you mortgage is owned by Fannie Mae, visit Know Your Options to learn more about foreclosure assistance options.

FREDDIE MAC, 1-800-FREDDIE (8am to 8pm EST), FreddieMac.com/mymortgage 

If you mortgage is owned by Freddie Mac, visit My Home to learn more about foreclosure assistance options.

Credit Card Authorized User Issues

Many of my clients are married and have credit cards that at least look like they are joint cards.  It can be confusing to figure out which of the two of them is obligated on a credit card.

If you have a credit card with someone else, the second person can be either a "joint account ownerr" or an "authorized user".  

An "authorized user" is a someone who is allowed to make purchases using your credit card.  Usually that someone has their own card with their name on it.  However, they are not legally responsible to pay the account, because they are not the account owner (although if they sign the credit card slip or terminal at the merchant I suppose it is possible the merchant could pursue them.  I think that is unlikely.)

If you, as the authorized user, don't have a credit history, or if you want to improve your score, being an authorized user on someone else's card might improve your own credit score if you are current and if the card issuer reports to the credit reporting agencies (as most do).  This is because the card issuer will report your usage to the credit reporting agency in your name as well as in the name of the account ownerr.  

However, as the account owner, adding an authorized user exposes you to the frolics and mistakes of the authorized user.  If they go out and have a party on your card, or if you trust them to make the payments on the card and they "forget", your credit score can be dragged down.  Worse, you are legally responsible for the permitted use of your card, so the card issuer can sue you.

If you are the authorized user, and if it is the account owner who is messing up, you can ask to have your name removed from the card.

Minnesota law provides that if you are joint account owners with your spouse "Either spouse may close a credit card account or other unsecured consumer line of credit on which both spouses are contractually liable, by giving written notice to the creditor." Minn. Stat. 519.05, subd. (b).

If you are in financial trouble, feel free to contact me at 320-252-4473.