The Federal Housing Finance Agency (FHFA) has announced that it is extending several loan origination flexibilities currently offered by Fannie Mae and Freddie Mac (the Enterprises) designed to help borrowers during the COVID-19 national emergency, including the authority to purchase mortgages in forbearance, until at least July 31. Other flexibilities that have been extended include:
- Alternative appraisals on purchase and rate term refinance loans
- Alternative methods for verifying employment before loan closing
- Expanding the use of power of attorney and remote online notarizations to assist with loan closings
The FHFA previously announced that Fannie Mae and Freddie Mac would be 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 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.
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.
Additionally, 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.
Also, in an effort to provide additional financing options to single-family mortgage lenders, Fannie Mae’s ability to purchase single-family mortgages in forbearance has been extended to include loans with note dates on or before June 30, 2020, provided the loans are delivered by August 31 and no more than one mortgage payment has been missed. The previous policy was set to expire on May 31.