Sponsors (14)
The bill provides clear, flexible short-term mortgage relief for disaster-affected borrowers (including many with federally backed loans) while shifting costs, operational burdens, and some financial risks onto servicers, lenders, investors, and potentially taxpayers, and leaving gaps for victims lacking documentation or for disasters without a Presidential declaration.
Homeowners with disaster-damaged federally backed or other covered mortgages can pause mortgage payments for an initial 180 days and extend once for up to 180 more (up to ~12 months), giving substantial short-term relief after a disaster.
Homeowners will not incur extra fees, penalties, or additional interest beyond what would have accrued with on-time payments while in forbearance, protecting borrowers from higher balances.
Homeowners can stop forbearance at any time, letting borrowers resume payments when ready and avoid unnecessary prolonged relief.
Lenders and investors in mortgages and mortgage-backed securities will face delayed payments and cash-flow disruptions while interest and principal are paused, which could raise mortgage pricing or reduce credit availability over time.
Mortgage servicers must grant lengthy forbearances and process documentation, increasing administrative costs that could be passed on to borrowers or affect servicing fees.
Taxpayers could face increased costs if expanded disaster protections require federal support or forbearance assistance for loans held or guaranteed by GSEs.
Based on analysis of 3 sections of legislative text.
Requires servicers to grant 180-day forbearance (one 180-day extension allowed) for covered federally backed mortgages on disaster-damaged property, with no extra fees or added interest.
Official title: To provide forbearance assistance during a major disaster or emergency, and for other purposes.
Introduced April 17, 2025 by Judy Chu · Last progress April 17, 2025
Allows owners of 1–4 family homes and owners of multifamily properties with federally backed mortgage loans in Presidentially declared disaster areas to request automatic forbearance if their property was damaged or destroyed. Servicers must grant an initial 180-day forbearance on written request with verifiable documentation, allow one extension of up to 180 more days, let borrowers end forbearance early, and must not impose fees, penalties, or extra interest beyond what would have accrued under on-time contractual payments during forbearance.