By Ed Pierce
Fannie Mae, a
government-sponsored enterprise that makes mortgages available to low- and
moderate-income borrowers, has taken steps to help homeowners and those seeking
to purchase a home affected by the COVID-19 pandemic by adjusting some
guidelines temporarily.
Homeowners who have taken
a forbearance, or a temporary postponement of mortgage payments, because of a
COVID-19 financial hardship are eligible to refinance their mortgage or buy a
new home. Additionally, Fannie Mae is granting a month extension that will enable
lenders to sell to Fannie Mae single-family loans currently in forbearance.
“We are listening to and prioritizing our customers’ needs,
helping them serve homeowners efficiently and responsibly. Today’s updates
provide clarity and support to both lenders and borrowers in a manner that
fosters sustainable homeownership, prudently manages enterprise and taxpayer
risk, and maintains safety and soundness in the housing finance system,” said
Malloy Evans, Fannie Mae’s Senior Vice President and Single-Family Chief Credit
Risk Officer.
Under the these new temporary eligibility directives, homeowners
who missed payments and have entered into a loss mitigation solution, whether
it be a repayment plan, payment deferral, or a loan modification, find
themselves now eligible for a new refinance or able to purchase mortgage after making
three payments on time.
Evans said that there is no waiting period for borrowers who
missed payments due to a COVID-19 financial hardship, but who have since
completed reinstatement by repaying the full amount of the outstanding payments
missed during the forbearance period.
There also is no waiting period for borrowers who requested
forbearance due to a COVID-19 financial hardship but ultimately were able to
make all their payments in full and on time, Evans said.
Additionally, Fannie Mae’s ability to purchase single-family mortgages
in forbearance have been extended in an effort to provide additional financing
options to single-family mortgage lenders. Loans dated on or before June 30,
2020 are extended provided that they loans are delivered by Aug. 31, 2020 and only
one mortgage payment has been missed.
Using terms of a COVID-19
forbearance plan, homeowners are required to repay the missed payments, but the
new change does not require them to repay the forbearance all at once. When an
individual’s plan is up, mortgage servicers must work with the homeowner to
determine how they will repay missed payments.
Homeowners and renters are
encouraged to can visit Fannie Mae’s KnowYourOptions.com
website for an overview of the various options available to those who might
need help resulting from COVID-19 hardships.
Just since March of this year, Fannie Mae has undertaken a number of significant actions to help homeowners and renters facing COVID-19 financial hardships.
According to a press
release issued by Fannie Mae, it has moved to suspend foreclosures and
evictions affect ting homeowners, extended and strengthened eviction procedures
for multi-family renters when the property owner or landlord received a
forbearance, modified schedules for forbearance repayments, created a new
COVID-19 payment deferral option to assist homeowners resuming their monthly
mortgage payments following a forbearance, and launched “Here to Help,” an
educational effort to connect homeowners and renters with tools and resources
to navigate available options if they sustain a COVID-19 financial hardship.
"Fannie
Mae is committed to providing sustainable housing options to help keep people
in their homes," said Hugh R. Frater, Chief Executive Officer for Fannie
Mae. "We hope ‘Here to Help’ will bring some clarity, transparency, and
assurance to homeowners and renters who are facing job loss, reduction in work
hours, illness, or other issues related to COVID-19."
The "Here to Help" online portal at KnowYourOptions.com features
informative videos, fact sheets, mortgage loan and apartment rental lookup
tools,and various other handy resources to equip homeowners and renters with
the information they need to successfully navigate their options. The portal
also provides mortgage servicers and lenders with tools to better assist their
customers.
Some of these new options include a clear explanations of
forbearance, repayment options after forbearance, and training videos for loan servicers.
Through
"Here to Help," homeowners and residents of multifamily rental
properties with a Fannie Mae-backed mortgage can access HUD-approved housing
counselors via the Disaster Response Network. Fannie Mae finances about
one-in-four homes and one-in-five multifamily mortgage loans in the United
States.
"We are
committed to putting people first, helping Americans stay in their homes,
helping customers stay in business, and ensuring that the nation's mortgage and
housing markets remain strong," said Frater.
Fannie Mae partners with lenders and families across the country and
strives to make 30-year fixed-rate mortgages and affordable rental housing
possible for millions of Americans. <
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