GSEs give more Covid-related guidance

Federal Issues Fannie Mae Freddie Mac Covid-19 Mortgages

On October 14, Fannie Mae and Freddie Mac (collectively, “GSEs”) clarified that a borrower will not lose any future “pay for performance” HAMP incentives if the borrower: (i) immediately reinstates the mortgage loan upon expiration of the Covid-19-related forbearance plan; or (ii) transitions directly from a Covid-19 related forbearance plan to a repayment plan. The GSEs previously clarified that if a mortgage loan was modified pursuant to a HAMP modification and the borrower remains in good standing, the borrower will not lose any pay for performance incentives if the borrower had a Covid-19 related hardship immediately preceding the Covid-19 payment deferral (covered by InfoBytes here and here). The updates are reflected in Fannie Mae’s Lender Letters LL-2020-02, LL-2020-07, and Freddie Mac’s Guide Bulletin 2020-39.