HUD and FHA further extend Maui’s foreclosure moratorium through 2025
The Federal Housing Administration (FHA) published a mortgage letter on Friday 2024-2015which extends a foreclosure moratorium on the Hawaiian island of Maui through January 1, 2025, for FHA-insured term mortgages and Home Equity Conversion Mortgages (HECMs).
The moratorium, which was initially set to expire on May 6 after an earlier extension, was pushed back to August earlier this year. It has now been extended into the new year in recognition of the ongoing recovery efforts taking place following the island’s bushfires in the summer of 2023.
The U.S. Department of Housing and Urban Development (HUD) “is now extending the foreclosure moratorium on properties in Maui County, Hawaii, due to the extent of devastation from the wildfires, reduced ability to access needed resources, and Maui’s unique geographic location,” the letter said. .
“HUD believes that borrowers need the additional time provided by the moratorium to access federal, state or local housing resources, to rebuild the home and to consult with HUD-approved housing counselors.”
The moratorium “applies to the initiation of foreclosures and to the completion of pending foreclosures,” the letter said. It also applies to HECM loans, also known as reverse mortgages under the FHA-sponsored program.
The moratorium applies “only if the HECM becomes due for reasons other than the death of the last surviving borrower and no grace period applies; and to initiate bankruptcies and bankruptcies that are already pending,” the ML said.
Immediately following the wildfires, the FHA reminded lenders and servicers of both forward and reverse mortgages that relief options are available for those affected by recent natural disasters. It told lenders to contact affected borrowers as soon as possible about possible forbearance relief.
