The Federal Housing Financing Agency (FHFA) announced Tuesday that Fannie Mae and Freddie Mac have issued temporary guidance regarding the eligibility of borrowers in forbearance, or recently ended their forbearance, looking to refinance and purchase a home.
Borrowers are eligible to refinance or buy a new home if they are current on their mortgage—or in forbearance but continued to make payments or reinstated their mortgage. They are also eligible to refinance or buy a new home three months after their forbearance ends and they have made three consecutive payments under their repayment plan, deferral option, loan modification.
“Homeowners who are in COVID-19 forbearance but continue to make their mortgage payment will not be penalized,” said FHFA Director Mark A. Calabria. “Today’s action allows homeowners to access record low mortgage rates and keeps the mortgage market functioning as efficiently as possible.”
The FHFA recently announced it is extending the GSE’s previously announced ability to purchase single-family mortgages in forbearance. Fannie Mae and Freddie Mac are now able to buy loans in forbearance, with note dates on or before June 30, as long as they are delivered by August 31 and have missed just one mortgage payment.
The previous policy was set to expire on May 31.
The agency also announced that foreclosure and eviction moratoriums backed by Fannie Mae and Freddie Mac were extended to June 30. Deadlines for that moratorium were set to expire on May 17.
“During this national health emergency, no one should be forced from their home," Calabria said. “Extending the foreclosure and eviction moratoriums protects homeowners and renters with an Enterprise-backed mortgage and provides certainty for families.”
The FHA announced that it would halt all new foreclosure actions and suspend all foreclosure actions currently in process, excluding legally vacant or abandoned properties. Also, the Administration will cease all evictions of persons from FHA-insured Single Family properties, excluding actions to evict occupants of legally vacant or abandoned properties.
“We made it clear at the beginning of this pandemic that no American should have to worry about losing their home amidst a crisis. Today’s announcement ensures that commitment,” said U.S. Department of Housing and Urban Development Secretary Dr. Benjamin Carson. “While we have made great strides in fighting this virus, the fact remains that many Americans are still struggling as we work diligently to get our economy back on sound footing, which I have full confidence we will do through the leadership of the President.”