According to Bloomberg report, to help unemployed borrowers keep their homes, Freddie Mac has announced on 6th of January that it is giving mortgage servicers authority to give unemployed borrowers with Freddie Mac owned or guaranteed mortgages six month of forbearance without prior approval from the giant mortgage lender. And an additional up to six months, or a full year, with Freddie mac's prior approval.
Previously, Freddie mac allowed servicers to grant only up to three months of forbearance with no payment and without prior approval, or six months at a reduced payment with prior approval. And the only reasons acceptable for the longer forbearance are natural disasters, permanent disability or long-term medical emergencies.
Under the new Freddie Mac's deal, delinquent borrowers in an existing short term forbearance plan can be considered for an extended forbearance under the new policy. According to the latest statistics, nearly 10% of delinquencies of Freddie Mac mortgages were tied to unemployment.
The new forbearance relief options were designed to effectively assist struggling borrowers through a period of unemployment, giving them more time to get back on their feet without worrying about losing their homes.
The expanded forbearance is set to take effect on February 1, 2012.
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