Freddie Mac partially extends hurricane foreclosure moratorium.
Eligible homeowners in the 21 counties and parishes in Alabama, Louisiana, Mississippi and Texas most affected by Hurricanes Katrina and Rita will enjoy a continued mortgage foreclosure suspension until May 31, Freddie Mac announced in its Feb. 10 Guide Bulletin sent to Freddie Mac's seller/servicers.
"We are replacing our one-size-fits-all approach with a zone approach," explained Janet Eakes, senior vice president of Freddie Mac's operations division. "Our servicers have done an outstanding job helping borrowers with Freddie Mac-owned loans in the immediate aftermath of the storms."
According to Freddie's bulletin, the zone approach divides the 120 Gulf Coast counties covered by last year's foreclosure moratorium into three separate zones, and applies appropriate policies to each.
In zone 3--which includes the 21 counties and parishes in federally designated disaster areas where Federal Emergency Management Agency (FEMA) individual assistance is available--Freddie Mac expanded its foreclosure moratorium through May 31, 2006.
In zone 2--which includes 34 counties and parishes with less-severe damage--servicers must obtain Freddie Mac's prior approval before initiating a foreclosure. And in the remaining 65 counties of zone 1, where there was no or minimal storm damage, Freddie has lifted its blanket foreclosure moratorium.
However, Freddie Mac said it has strongly encouraged servicers to extend mortgage relief to borrowers with Freddie Mac loans on a case-by-case basis, regardless of zone. Freddie has also authorized servicers to provide a wide range of mortgage relief to storm victims, including forbearance for up to one year from the date of the disaster.
The Feb. 10 Guide Bulletin instructs servicers to help borrowers strengthen their credit reputations by reporting timely mortgage payments to credit-reporting agencies as they bring their mortgages current. Until then, the bulletin reminds servicers not to report storm-related forbearances or bankruptcies to credit bureaus, and to waive prepayment premiums for storm victims in some cases.
For more information, lenders can contact their Freddie Mac account representative or review the Feb. 10 Guide Bulletin at www.freddiemac.com/sell/guide/bulletins.
|Printer friendly Cite/link Email Feedback|
|Title Annotation:||Federal Home Loan Mortgage Corp|
|Date:||Mar 1, 2006|
|Previous Article:||Senate Banking Committee to take another shot at GSE reform.|
|Next Article:||Senate Banking Committee examines flood insurance overhaul.|