Fannie Mae, Freddie Mac halt foreclosures
Fannie Mae and Freddie Mac announced today that they will offer victims of Superstorm Sandy additional relief as they all homeowners with mortgages backed by either government-sponsored entities will see an automatic 90-day suspension on foreclosure sales and evictions, effectively immediately.
“These steps are intended to provide borrowers with peace of mind and help lay the groundwork for a faster recovery in the neighborhoods and communities affected by the storm,” said Tracy Mooney, Freddie’s Senior Vice President of Single-Family Servicing and Real Estate.
Additional relief efforts
Additionally, Fannie and Freddie will expand their relief efforts announced immediately after the storm, allowing servicers to offer 90-day postponments of mortgage payments more quickly by offering them over the phone rather than in person, and they can extend that forbearance by up to 12 months without having to slow the process by consulting with Fannie and Freddie.
Fannie and Freddie will also maintain pricing for mortgage applicants whose purchases were delayed by Sandy, so they won’t incur additional fees on closing day.
Servicers have also been directed to expedite payments of insurance claims and they will be able to immediately approve the release of funds to repay homeowners for destroyed belongings and reimburse living expenses. The companies will also ease normal restrictions on payments to contractors for repairs to get borrowers back into their homes more quickly.