December 2, 2021

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Do You Need Help Saving Your FHA Mortgage?


Do you worry about your ability to make payments on your FHA home loan? You are not alone, and the FHA and HUD want to help.

There have been many foreclosure prevention measures taken by lenders and the FHA/HUD alike including a COVID-19 related foreclosure moratorium, loan modification options for qualifying applicants and much more.

In early 2021, the FHA and HUD announced “loss mitigation options” to help those recovering financially from the pandemic; these included a COVID-19 Advance Loan Modification offered to “…eligible delinquent Borrowers who can achieve a 25 percent reduction to the Principal and Interest (P&I) portion of the Borrower’s monthly mortgage payment through a 30-year rate and term loan modification” according to

The FHA and HUD continue evaluating how the pandemic has affected the agency’s ability to guarantee loans and the nation’s recovery from COVID-19, financially speaking.

In spite of evidence that “economic indicators are trending positive”, more relief may be needed for HUD to “support a sustained and equitable recovery as well as to protect the Mutual Mortgage Insurance Fund”.

In the era of COVID, there are still options for what HUD calls “loss mitigation”. That basically means there is continued help for FHA borrowers who may be financially affected by COVID-19 issues in 2021. What options do FHA borrowers have?

According to a recent Mortgagee Letter (FHA Mortgagee Letter 2021-18, issued in late July 2021) the following options are offered to FHA borrowers who might need it and who qualify–according to HUD, these options are for “borrowers impacted, directly or indirectly, by COVID-19”;

–COVID-19 Forbearance

–COVID-19 Advance Loan Modification

–COVID-19 Recovery Standalone Partial Claim

–COVID-19 Recovery Modification

–COVID-19 Recovery Non-Occupant Loan Modification

–COVID-19 Pre-Foreclosure Sale

–COVID-19 Deed-in-Lieu of Foreclosure

The FHA and HUD have streamlined some options in mid-2021, but options still exist for borrowers who need them. If you are experiencing financial hardship related to the pandemic, it is crucial for you to reach out to your loan servicer immediately to learn what options may be open to you.

Those who miss more than one house payment will find their foreclosure prevention options getting more restricted with each payment missed.

If you act quickly to protect your mortgage, you will have more flexible options than if you are about to miss a payment that could potentially be the point of no return for a foreclosure.

Granted, foreclosures have been suspended on FHA mortgages as a part of COVID-19 relief, but the foreclosure moratorium will not last forever; sooner or later home owners will have to contend with the end of these pandemic relief measures.

Those who act sooner rather than later are in the strongest position to save their homes.

Learn About the Path to Homeownership
Take the guesswork out of buying and owning a home. Once you know where you want to go, we’ll get you there in 9 steps.

Step 1: How Much Can You Afford?
Step 2: Know Your Homebuyer Rights
Step 3: Basic Mortgage Terminology
Step 4: Shopping for a Mortgage
Step 5: Shopping for Your Home
Step 6: Making an Offer to the Seller
Step 7: Getting a Home Inspection
Step 8: Homeowner’s Insurance
Step 9: What to Expect at Closing

Joe Wallace - Staff Writer

By Joe Wallace

August 9, 2021

Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for for (8) years and is currently the Associate Editor for

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About was launched in 2010 by seasoned mortgage professionals wanting to educate homebuyers about the guidelines for FHA insured mortgage loans. Popular FHA topics include credit requirements, FHA loan limits, mortgage insurance premiums, closing costs and many more. The authors have written thousands of blogs specific to FHA mortgages and the site has substantially increased readership over the years and has become known for its “FHA News and Views”.

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