Homeowners who have reduced income or lost their jobs because of the coronavirus pandemic are being offered some relief.
Federal regulators, through the mortgage giants Fannie Mae and Freddie Mac, are ordering lenders to offer homeowners flexibility. Fannie and Freddie guarantee about half of all home loans in the U.S.
Depending on their situation, homeowners who are current on their mortgage should be eligible to have their mortgage payments either reduced or suspended for up to 12 months.
This is not a forgiveness of debt or free money. Homeowners must be proactive and contact their mortgage servicer to work out a repayment plan or a forbearance (suspension) once they recover financially. This might entail just extending the term of the loan, but it will likely vary by lender and each homeowner’s situation.
Homeowners can find out if they have a Fannie Mae-owned mortgage and access to the Disaster Response Network™* by visiting www.KnowYourOptions.com/loanlookup.
Fannie and Freddie are also directing lenders to suspend foreclosures for the next 60-days, though this is more of a public health move because anyone facing foreclosure already would have run into serious financial trouble before the coronavirus started to spread in the United States.
We have created a response team to the rapidly changing COVID-19 situation, and will continue to post any new developments. You can view the page and additional resources by following the link here. In the meantime, if you have any questions, please contact your Fraser Trebilcock attorney.