March 18, 2020 - 3:22 PM
Mortgage buyers Fannie Mae and Freddie Mac said Wednesday that they will suspend all foreclosure sales and evictions of borrowers in single family homes owned by their companies.
The action is among the many efforts going on nationwide to protect those affected by the coronavirus pandemic.
Fannie Mae and Freddie Mac do not make loans, but buy them from lenders and bundle them into securities, guarantee them against default and sell them to investors. Together they guarantee about half of the U.S. home market. Both have been under the control of the federal government since the 2008 financial crisis.
The companies also announced other mortgage relief options, including an expansion of its forbearance program, which gives borrows relief for up to one year and suspends late charges and penalties. They also suspended 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.
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, Freddie Mac said.
“Borrowers who may be experiencing financial challenges due to COVID-19 are encouraged to contact their mortgage servicer – the company they send their monthly mortgage payments to – to explore their options,” Freddie Mac said in a statement.
News from © The Associated Press, 2020