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This topic for me began with a video I watched on YouTube Last night put out by a Youtuber who goes by “Meet Kevin”.
In case you’d like to watch the video on YouTube, here’s the Link: https://youtu.be/iepZC3HdS8E
The video was about the coming proposed changes to the CFPB’s policies as they relate to mortgage forbearance. The CFPB (Consumer Finance Protection Board) is concerned that in the coming months we could slip into a major foreclosure crisis spawned from the mass number of mortgages that will be exiting forbearance very soon.
Here is a link to the proposed ruling: https://www.cashflowguys.com/wp-content/uploads/2021/04/CFPB-Proposed-Ruling.pdf
Currently, there are approximately 3 million Loans in forbearance
1.7 million of those mortgages need to start getting repaid (forbearance expiring)
In short, their short-term proposal is to force loan servicers (lenders) to extend a borrower’s mortgage by as much as 40 YEARS. (480 months) That’s 40 years ON TOP of the remaining time you have on the mortgage.
It flat out says the borrow if affected by covid has a RIGHT to a 40-year extension.
The proposed policy change also suggests no foreclosure filings allowed until Dec 2021.
This is a very unique situation, after playing the audio from Meet Kevin’s video I break down what he said and hopefully provide some insight that will help you see the bright side of this situation as it pertains to us real estate investors.