Foreclosures Suspended! Fannie & Freddie Go the Distance with Mortgage Relief for COVID-19

Two weeks ago HUD and FHFA announced they would halt foreclosures for approximately 60 days, at least... both regulators surely understanding this was a moving target. And while meaningful, that was an announcement for borrowers already in financial distress. It isn't really COVID-19 relief...but it was social mercy for those who won't be able to go anywhere else.

Hot on the heels of that release, Fannie and Freddie at the direction of FHFA went further. They proposed actual COVID-19 relief:

1. A mortgage forbearance (a reduction or suspension of payments) up to 12 months),

2. A potential loan modification after the forbearance period,

3. The waiver of penalties and late fees, and

4. The suspension of reporting delinquencies to the credit bureaus for the next 12 months.

And for the moral hazard clause - no requirement to document anything associated with COVID-19 loss or illness.

Again - HUD has not issued any guidance on relief other than halting foreclosures.

For the bulletins:

Freddie: http://www.freddiemac.com/about/covid-19.html

Fannie: https://www.fanniemae.com/portal/covid-19.html