WASHINGTON, D.C. – The government-controlled lending companies Fannie Mae and Freddie Mac (“the Enterprises”) are extending moratoriums on single-family foreclosures and real estate-owned evictions until March 31, the Federal Housing Finance Agency (FHFA) announced Tuesday.
The foreclosure moratorium applies only to Enterprise-backed single-family mortgages, the FHFA emphasized. The REO eviction moratorium applies to properties that have been acquired by either agency through foreclosure or deed-in-lieu-of-foreclosure transactions. The current moratoriums were set to expire February 28.
Borrowers with a mortgage backed by Fannie Mae or Freddie Mac may be eligible for an additional forbearance extension of up to three months, FHFA reported. Eligibility for the extension is limited to borrowers who are on a COVID-19 forbearance plan as of February 28, and other limits may apply.
Further, COVID-19 payment deferral for borrowers with an Enterprise-backed mortgage can now cover up to 15 months of missed payments. The payment deferral program allows those borrowers to repay their missed payments at the time the home is sold, refinanced or at mortgage maturity.
“To keep families in their home during the pandemic, FHFA is allowing borrowers to be in COVID-19 forbearance for up to 15 months and extending the Enterprises’ foreclosure and eviction extension,” FHFA Director Mark Calabria said.
FHFA projects expenses of $1.5 billion to $2 billion will be borne by the Enterprises due to the existing COVID-19 foreclosure moratorium and its extension, Calabria said.
FHFA is monitoring the effect of COVID-19 servicing policies on borrowers, Fannie Mae and Freddie Mac and their counterparties, plus the mortgage market, he said. FHFA may extend or sunset its policies based on data and health risk, he added.