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Millions of Americans have been grappling with income loss since the coronavirus pandemic began. That includes homeowners, many of whom risk falling behind on their mortgage payments and losing their homes in the process. Thankfully, there's twofold relief available to struggling homeowners: the option to put mortgages into forbearance, and a ban on foreclosures and evictions for borrowers who were behind on their mortgage payments before the pandemic started. 

Originally, that foreclosure and eviction moratorium was set to expire at the end of December. But on Dec. 2, the Federal Housing Finance Agency (FHFA) announced it's extending its foreclosure and eviction ban through Jan. 31, 2021. That moratorium applies to Fannie Mae- and Freddie Mac-backed mortgages for single-family units. It buys homeowners facing foreclosure a little more time before they have to worry about being removed from their homes.

Clearly, extending the moratorium is a good thing for desperate homeowners. But is it really enough aid in light of the enormous housing crisis at hand?

Homeowners need more relief

The current foreclosure and eviction moratorium has been in effect since March 18, 2020. The FHFA says it protects more than 28 million homeowners with mortgages guaranteed by Fannie Mae and Freddie Mac, the government-sponsored entities who buy mortgages. As long as that ban is in place, mortgage lenders can't proceed with foreclosure actions and also can't move forward with foreclosures that were already in progress prior to the pandemic. 

Furthermore, lenders are still required to continue to offer up to 360 days of mortgage forbearance when borrowers request it. This lets homeowners hit pause on their monthly payments. Normally, lenders can deny forbearance, but now, they must agree to an initial 180 days of paused payments plus an additional 180-day extension upon request. They're not required to extend forbearance automatically. And though borrowers will need to catch up on their missed payments once their forbearance period comes to a close, lenders can't demand one immediate lump-sum repayment. 

What happens when protections expire?

These protections have no doubt helped countless Americans avoid losing their homes or get evicted. But the question remains: What happens when these provisions expire? If the foreclosure and eviction moratorium isn't further extended, some homeowners will risk homelessness. Similarly, it's unclear as to what will happen to borrowers who reach the end of their 360 days of forbearance and aren't better positioned to start making mortgage payments again. 

Also, while these protections are designed to protect homeowners, many renters have been struggling during the pandemic as well. The Trump administration put an eviction moratorium in place for some renters on Sept. 1 that's set to last through the end of the year. But as of now, there's been no indication it will be extended. 

Right now, lawmakers are trying to hammer out a second coronavirus relief package. But it's not clear whether it will include adequate housing aid. And we may not find out for quite some time.