Freddie Mac announces enhanced relief for borrowers impacted by COVID-19
Freddie Mac announced March 18 it is taking numerous actions to protect those affected, either directly or indirectly, by the novel coronavirus, known as COVID-19.
Specifically, for its Single-Family business, the company announced a nationwide suspension of all foreclosure sales and evictions of borrowers living in homes owned by the company. It also announced a variety of additional mortgage relief options, including an expansion of its forbearance program, to incorporate additional impacted borrowers. The company also has reminded servicers of its existing suite of mortgage relief options to assist borrowers, while also making additional disaster related loan modifications available.
These measures are effective immediately and apply to borrowers who are unable to make their mortgage payments due to a decline in income resulting from the impact of COVID-19, regardless of whether they have contracted the virus.
Forbearance plans provide borrowers with payment relief for up to 12 months and suspend borrower late charges and penalties. It also suspends reporting to credit bureaus of past due payments of borrowers who are in a forbearance plan as a result of hardships attributable to this national emergency.
“We are doing all we can to help those adversely impacted by the coronavirus, including by immediately suspending foreclosure sales and evictions during this challenging time,” said Donna Corley, executive vice president and head of Freddie Mac’s Single-Family business. “These eviction and foreclosure stoppages are just one part of the comprehensive assistance we’re providing borrowers to help protect our communities. We are also expanding relief available through our well-known forbearance programs, allowing us to reach the majority of affected borrowers as expeditiously as possible.”
Borrowers who may be experiencing financial challenges due to COVID-19 are strongly encouraged to contact their mortgage servicer — the company they send their monthly mortgage payments to — so they can explore one of the Freddie Mac workout options.
Freddie Mac’s mortgage relief options for borrowers impacted by COVID-19 include ensuring payment relief by providing borrowers forbearance for up to 12 months; waiving assessments of penalties or late fees against borrowers; suspending the reporting of delinquency related to forbearance, repayment or trial plans to credit bureaus; and allowing servicers to offer borrowers additional loss mitigation options that are typically only enacted to address natural disasters. This includes loan modifications that give servicers options to provide payment relief or keep the payment the same post the forbearance period.
Borrowers are eligible for forbearance regardless of whether their property is owner occupied, a second home or an investment property.
The suspension of foreclosure sales and evictions is effective immediately and applies until May 17. If necessary, and at the direction of the Federal Housing Finance Agency, Freddie Mac may extend the suspension of evictions beyond May 17.
For more, visit freddiemac.com.