WASHINGTON Jan 31 Government-backed housing
giants Fannie Mae and Freddie Mac and the
Federal Housing Administration on Thursday extended their
disaster-relief policies to borrowers whose homes were damaged
by Superstorm Sandy.
The aid applies to property owners living along the eastern
United States, mainly in nine states and the District of
Columbia that have been declared disaster areas by President
Millions of people were left reeling in the aftermath of the
super storm that made landfall in late October and resulted in
flooding, wide-spread power outages and deaths.
"It's all too clear that families need more time to get back
on their feet without having a foreclosure or eviction hanging
over their heads," said U.S. Housing and Urban Development
Secretary Shaun Donovan. "We'll do everything we can to ease the
crushing burden being faced by those homeowners."
Donovan was appointed by Obama to lead rebuilding efforts in
those cities and states ravaged by the historic storm. The
announcement was made in conjunction with Fannie Mae and Freddie
Mac's regulator, the Federal Housing Finance Agency.
For those impacted borrowers with Fannie Mae and Freddie
Mac-backed loans, they will have a new 90-day extension to
suspend foreclosure sales or eviction lockouts.
The government-backed mortgage lenders are also allowing
servicers to offer forbearance, which lets a borrower reduce or
suspend payments on a loan for a specific amount of time, or to
offer loan modifications or waive late fees against borrowers
with disaster-damaged homes or jobs within the impacted areas.
Fannie and Freddie, the two largest sources of housing
money, were taken over by the government in September 2008
during the financial crisis.
The government-controlled companies do not directly make
loans. Instead, they buy mortgages from lenders and repackage
them as securities for investors.
The Federal Housing Administration, the government-mortgage
insurer that mainly supports low and moderate income borrowers,
will extend the moratorium for another 90 days on the initiation
of foreclosures and those home seizures already in process.
Those in storm damaged areas with FHA loans will also have
evictions suspended through April 30.