Biden Administration Offers Loan Modification Program To Keep Forbearance Low

The Biden administration has announced a new measure meant to keep homeowners out of mortgage forbearance, offering loan modification options for the holders of certain mortgages.

The federal government will require the issuers of some mortgages “to offer options that allow borrowers to move missed payments to the end of the mortgage at no additional cost to the borrower,” the White House said in a statement.

The administration also announced additional measures such as a homeowner assistance fund as well as “a new security product for modified loans that would provide government agencies the flexibility to extend mortgage terms to up to 40 years.”

“Homeowners with government-backed mortgages that have been negatively impacted by the pandemic will now receive enhanced assistance, especially if they are looking for work, re-training, having trouble catching up on back taxes and insurance, or are continuing to experience hardship for another reason,” the White House said.