NEW Freddie Mac Guidelines - Forbearances for Unemployed Borrowers

Here is am email we just received regarding Freddie Mac's new guidelines for forbearance repayment loan modifications for delinquent unemployed borrowers -

Single-Family Update

Categories in this update:

Originate & UnderwriteSell & DeliverServicing

January 6, 2012

To better address the realities of extended unemployment that many borrowers face, as a Freddie Mac Servicer, you now have additional solutions to help unemployed borrowers keep their homes. Beginning today, you can offer eligible borrowers a short-term unemployment forbearance period, and the possibility of an extended unemployment forbearance period, if needed.

These new forbearance relief options are tools you can use to effectively assist struggling borrowers through a period of unemployment, providing families with a greater measure of security while working mutually toward the ultimate goal of keeping them in their home.

Servicing

Single-Family Seller/Servicer Guide (Guide) Bulletin 2012-2, issued today, provides our servicing requirements for unemployment forbearance with requirements for:

  • Delegated authority for you to offer short-term unemployment forbearance to borrowers experiencing a financial hardship due to unemployment. You may suspend or reduce an eligible borrower’s mortgage payments for a period of six months.
  • An additional forbearance period, which requires you to obtain Freddie Mac's approval. This extended unemployment forbearance period allows for suspended or reduced payments for eligible borrowers up to an additional six months, provided it does not extend beyond a date that would cause the delinquency to exceed 12 months of the borrower’s payments.

A borrower who was complying with the terms of his or her Home Affordable Modification program (HAMP) or Freddie Mac Standard Modification trial period plan prior to entering unemployment forbearance may be re-evaluated for a new HAMP or Standard Loan Modification trial period plan if he or she is eligible at the termination or expiration of unemployment forbearance.

You may offer these new mortgage relief options to eligible borrowers immediately, but you must incorporate unemployment forbearance into your operations no later than February 1, 2012.

Refer to today's Guide Bulletin for comprehensive requirements, including eligibility, borrower documentation, and reporting requirements for unemployment forbearance.

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