Freddie Mac Suspends Evictions and Foreclosures in Eligible Areas

Investor Update: On November 9, Freddie Mac released a notice entitled Freddie Mac Suspends All Evictions, Foreclosures In Hurricane Sandy Major Disaster Areas.

Freddie Mac Suspends All Evictions, Foreclosures In Hurricane Sandy Major Disaster Areas

Company Preparing Steps to Expedite Forbearances, Repairs with Insurance Proceeds

Freddie Mac (OTC: FMCC) announced that, after consultation with the Federal Housing Finance Agency, it is taking additional steps as part of its commitment to help borrowers affected by Hurricane Sandy including the immediate and mandatory suspension of evictions and foreclosures on homes secured by Freddie Mac owned-or guaranteed mortgages in eligible disaster areas.  The new policy changes are scheduled to go to mortgage servicers next week and build on Freddie Mac's October 30 announcement of storm relief for borrowers with homes in presidentially declared Major Disaster Areas where federal Individual Assistance programs are available.  Freddie Mac is one of the nation's largest investors in residential mortgages.

News Facts:
Freddie Mac is revising its disaster relief policies to authorize mortgage servicers to:

  • Automatically suspend for 90-days evictions and foreclosure sales for borrowers with homes secured by Freddie Mac owned-or guaranteed mortgages and located in eligible disaster areas borrowers are still encouraged to contact their servicers to discuss their situation.  Freddie Mac disaster policies enable servicers to extend forbearance and repayment plans for up to 12 months on a case-by-case basis without prior Freddie Mac approval.
  • Authorize servicers to verbally grant 90-day forbearances to all borrowers in eligible disaster areas, including borrowers with mortgages modified under the Home Affordable Modification Program (HAMP) or who are currently in a HAMP or Standard Modification Trial Period Plan.
  • Expedite the distribution of insurance proceeds on storm damage claims to speed up repairs of storm-damaged homes.

The additional disaster policy changes are scheduled to go to Freddie Mac servicers in a Guide Bulletin next week:

Additionally, Freddie Mac will maintain pricing that was in place at the time of the storm for mortgages that are secured by homes in eligible disaster areas and delivered through Freddie Mac's bulk guarantor channel.

Today's announcement builds on Freddie Mac's October 30 announcement of Hurricane Sandy relief policies which also instructed servicers to waive late fees or penalties against borrowers with disaster-damaged homes; and not report forbearance or delinquencies caused by the disaster to the nation's credit bureaus.

News Quote:

Attributable to Tracy Mooney, Senior Vice President of Single-Family Servicing and Real Estate Owned at Freddie Mac

"Given early assessments of Hurricane Sandy's devastating impact, we are preparing steps that will authorize automatic and immediate action by the nation's mortgage servicers to help more borrowers with mortgages owned or guaranteed by Freddie Mac.  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."

For more information on mortgage payment relief, homeowners should contact their mortgage servicer – the company to which they send their monthly mortgage payment – or call Freddie Mac at 800-FREDDIE.  Borrowers can determine if Freddie Mac owns their mortgage by using our loan look-up tool at https://ww3.freddiemac.com/corporate. Freddie Mac's general disaster relief policies are posted online at http://www.freddiemac.com/singlefamily/service/disastermgmt.html.

Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Today Freddie Mac is making home possible for one in four homebuyers and is one of the largest sources of financing for multifamily housing. www.FreddieMac.com.

To view the online notice, please click here.

About Safeguard
Safeguard Properties is the largest privately held field services company in the country. Located in Cleveland, Ohio and founded in 1990 by Robert Klein, Safeguard has grown from a regional preservation company with a few employees  and a handful of contractors performing services in the Midwest, to a national company with more than 1,600 employees. Safeguard is supported by a nationwide network of subcontractors able to perform any requested superintendence, preservation, and maintenance functions, as well as numerous ancillary services in the U.S., the Virgin Islands, and Puerto Rico.

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