Hello Valley Village and Los Angels Neighbors!
I know that we are in unprecedented times. I wanted to keep you aware of breaking news that directly affects property owners, as it is released.
Many homeowners have had to activate mortgage forbearance to get them through the current COVID-19 crisis. Whether due to the loss of work, getting sick, or tending to an ill family member, many of us are having trouble making ends meet.
If you have worked out a forbearance agreement with your loan servicer, please continue to read below regarding just released guidelines for the process of coming out of your forbearance period if your mortgage is backed by a GSE (Government Sponsored Enterprise), also know as Fannie Mae and Freddie Mac. The Federal Housing Finance Agency's press release follows in full and can be found here: https://www.fhfa.gov/Media/PublicAffairs/Pages/No-Lump-Sum-Required-at-the-End-of-Forbearance-says-FHFAs-Calabria.aspx?fbclid=IwAR0nl29i4vMKYotKnFGM9fD8wAuJl_EXNbzDq5lNB4JgNWRd4Zy4d7gF3zM
“No Lump Sum Required at the End of Forbearance” says FHFA’s Calabria
FOR IMMEDIATE RELEASE
4/27/2020
Washington, D.C. – To combat ongoing misinformation, the Federal Housing Finance Agency (FHFA) reiterated that borrowers in forbearance with a Fannie Mae or Freddie Mac (the Enterprises)-backed mortgage are not required to repay the missed payments in one lump sum.
“During this national health emergency, no one should be worried about losing their home," said Director Mark Calabria. “No lump sum is required at the end of a borrower's forbearance plan for Enterprise-backed mortgages. To help homeowners navigate the forbearance process, FHFA partnered with CFPB on the Borrower Protection Program to provide homeowners accurate information about forbearance and address concerns noted in some consumer complaints. While today's statement only covers Fannie Mae and Freddie Mac mortgages, I encourage all mortgage lenders to adopt a similar approach."
In response to the COVID-19 national emergency, the Enterprises permitted borrowers with a financial hardship due to the pandemic a forbearance option, which is a pause or reduction in their monthly mortgage. The missed payments will have to be paid back by the borrower. For those borrowers who opt for forbearance, their mortgage servicer will contact them about 30-days before the end of the forbearance plan to see if the temporary hardship has been resolved and discuss a variety of repayment options. If the hardship has not been resolved, the forbearance plan can be extended. If the hardship has been resolved, the servicer will work with the borrower to:
Set up a repayment plan;
Modify the loan so the borrower's payments are added to the end of the mortgage; or
Set up a modification that reduces the borrower's monthly mortgage payment.
Fannie Mae: Understand Your COVID-19 Mortgage Options
Freddie Mac: Lump Sum Repayment is Not Required in Forbearance
To learn more about the forbearance process you can read the script the Enterprises provided to mortgage servicers here.
Read more about FHFA and CFPB's Borrower Protection Program here.
To see the actions FHFA has taken to help Americans impacted by the coronavirus remain in their homes please visit FHFA's Webpage on Coronavirus Actions.
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The Federal Housing Finance Agency regulates Fannie Mae, Freddie Mac and the 11 Federal Home Loan Banks. These government-sponsored enterprises provide more than $6.3 trillion in funding for the U.S. mortgage markets and financial institutions. Additional information is available at www.FHFA.gov, on Twitter, @FHFA, YouTube, Facebook, and LinkedIn.
Contacts: Media: Raffi Williams Raffi.Williams@FHFA.gov