Freddie Mac and Fannie Mae told its network of servicers and attorneys to hold off on foreclosure sales of occupied single family and 2-4 unit properties from November 26 to January 6, 2009, as their streamlined modification plan is implemented. “By working closely with FHFA [the Federal Housing Finance Agency] and our servicers, Freddie Mac is on track to help three out of every five troubled borrowers with Freddie Mac- owned loans to avoid foreclosure this year,” according to Freddie Mac CEO David M. Moffett.
Freddie expects to OK 84,000 workouts for 140,000 delinquent borrowers in 2008. Fannie is reaching out to more than 10,000 borrowers.
Meanwhile, the American Bankers Association, the Center for Responsible Lending, and other industry groups are urging the Department of Housing and Urban Development to extend the FHASecure program at least through the end of 2009. “Even when investors may be agreeable to modifications, loans may be securitized in such a complex manner that the operational difficulties of obtaining investor approval present a high hurdle to overcome,” the groups wrote in a letter to HUD Secretary Steve Preston and OMB Director Jim Nussle. “FHASecure is a refinance program, not a loan modification program, thereby sidestepping these loan modification difficulties.”