About Government Refinance and Home Purchase Programs

Information and Updates on Government Mortgage Programs
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It looks like the bosses at Freddie Mac and Fannie Mae want to buy a little time for their new loan modification program to take hold. In order to do that they have called for a halt on foreclosures until the start of 2009. Here are some excerpts from a CNNmoney.com article on the subject:

NEW YORK (CNNMoney.com) — Mortgage giants Fannie Mae and Freddie Mac have directed their network of servicers to halt all foreclosure and eviction proceedings between Nov. 26 2008 and Jan. 9, 2009, meant to give a recently announced rescue plan time to work.

The Streamlined Modification Program, set to launch Dec. 15, enables delinquent borrowers to get a modified mortgage that lowers payments to no more than 38% of their gross incomes.

That’s accomplished by reducing mortgage rates, extending the term of the loans or deferring mortgage principals, or a mix of all three.

“By delaying these foreclosure sales, the nation’s servicers will have the opportunity to work with more borrowers who could qualify for a modification under the new [program],” said Freddie Mac CEO David M. Moffett in a statement.

Freddie has told its servicers to immediately contact the 6,000 borrowers who already have auction sales or evictions scheduled for between the specified dates to tell them the sales are postponed. Fannie estimated that 10,000 of its borrowers will be affected. Borrowers facing eviction between Nov. 20 and Nov. 26 were not expected to get relief.

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