Consumer Alert: CFPB orders lenders to work with homeowners to avoid foreclosure

ROCHESTER, N.Y. (WHEC) — Tuesday was a crucial deadline for some consumers. The programs designed to help you keep your house expired, but there are now other ways to avoid foreclosure thanks to the Consumer Financial Protection Bureau (CFPB).

Those folks at the CFPB stepped up to the proverbial plate and hit a solid grounder for consumers, not a home run, but a two-base hit. Now it’s up to us to run the rest of the way.

According to the CFPB, more homeowners are behind on their mortgage than at any time since 2010, the height of the great recession. Emergency measures to help homeowners expired Aug. 31.

So, there’s going to be an influx of folks who are coming out of programs that allow them to delay or reduce their mortgage for a period of time. For most, that period of time is ending this fall, which means it will be time for all those homeowners to pay up. That’s right.

Homeowners have to pay the amount they didn’t pay during the grace period. The CFPB knew this would happen after Aug. 31, so here are the new rules.

If your grace period — officially called forbearance — is coming to an end, lenders must tell you the exact date your grace period or forbearance is ending.

Then they have to tell you about forbearance extension or repayment plans, and they must tell you how to apply. The new rules mandate they also must tell you how to get homeownership counseling services.

If you’re not in a forbearance program, your lender must tell you programs are available, they must describe those programs, and they must tell you what you need to do to be considered for a mortgage grace period. Lastly, they have to tell you how to get homeownership counseling services.

In short, the CFPB is ordering lenders to work with you to give you some options before taking your house. So they have this advice: If you’re behind on payments and your lender calls, pick up the phone. It’s tempting to just let it ring, but pick up the phone. The CFPB says the sooner you talk to your lender, the better your options will likely be.