With Hurricane Lane reaching Hawaii, The government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, released information on their disaster relief policies. These policies are in place for borrowers in presidentially-declared disaster areas where the Federal Emergency Management Agency has made individual assistance programs available to affected individuals and households. Mortgage servicers may still leverage some programs even in non-FEMA assisted areas impacted by hurricane damage.
“At this time, it is important for those in the path of the storm to focus on their safety,” said Yvette Gilmore, Freddie Mac’s VP of Single-Family Servicer Performance Management. “Once out of harm’s way, we strongly encourage homeowners on the Hawaiian Islands whose homes or places of employment have been impacted by Hurricane Lane to call their mortgage servicer—the company to which borrowers send their monthly mortgage payments—to learn about available relief options.”
One main point in the GSE’s disaster relief policies is a 12-month mortgage forbearance, where mortgages may be suspended for up to 12 months. During this period, homeowners will not incur late fees or have delinquencies reported to the credit bureaus.
"It is important for those in the path of the storm to focus on their safety as they deal with the potential impact of Hurricane Lane," said Carlos Perez, SVP and Chief Credit Officer at Fannie Mae. "Fannie Mae and our lending and servicing partners are focused on ensuring assistance is offered to individuals and families in need. We urge everyone in the area to be safe, and we encourage homeowners affected by the storm to contact their mortgage servicer for assistance as soon as possible."
If a servicer believes a homeowner may be affected by a disaster, the servicer may be authorized to suspend or reduce payments on a mortgage for up to 90 days, or 12 months in certain circumstances. Additionally, Fannie Mae notes that servicers must suspend foreclosures or other legal proceedings if the servicer believes the homeowner has been impacted by a disaster.