Mortgage sellers, servicers reminded of relief options for borrowers impacted by Covid-19

Federal Issues Consumer Finance Mortgages FHFA FHA Mortgage Servicing Forbearance Covid-19 Debt Relief

On March 10, Federal Housing Finance Agency Director Mark Calabria released a statement reminding mortgage servicers that borrowers impacted by Covid-19 and experiencing payment hardship would be eligible for hardship forbearance options set forth in the relevant Fannie Mae and Freddie Mac servicing guidelines. Calabria directed sellers and servicers to guidance issued the same day by Freddie Mac, which also reminds sellers and servicers that business continuity plans must be in place in order to conduct business operations in the event of an interruption. Fannie Mae has provided similar guidance to its seller/servicers.

Separately, on March 9, the Federal Housing Administration (FHA) issued a notice to all FHA-approved mortgagees and servicers reminding entities of loss mitigation program options that should be offered to distressed borrowers, including those impacted by Covid-19, to prevent foreclosures. These options, FHA noted, are available in the Single Family Housing Policy Handbook, 4000.1 Section III.A.2.