Fannie Mae [1] is reminding those homeowners affected by the floods that have submerged huge areas of Louisiana that there are options for relief from the bills, at least in the near-term.
Fannie Mae’s guidelines for single-family mortgages allow servicers to temporarily suspend or reduce a homeowner's mortgage payments for up to 90 days, if they believe a natural disaster has “adversely affected the value or habitability of the property or if the natural disaster has temporarily impacted the homeowner's ability to make payments on their mortgage,” Fannie stated.
Servicers may grant relief even if they cannot contact the impacted homeowner immediately. If a servicer can contact a homeowner, the servicer may offer forbearance for up to six months, which may be extended for an additional six months, for those homeowners that were current or 90 days or less delinquent when the disaster occurred, according to Fannie.
Servicers may indeed have trouble contacting homeowners. By Tuesday, at least eight were confirmed dead and 20,000 displaced in southeastern Louisiana, where torrential rains overflowed levees and destroyed as many as 75 percent of homes in areas such as Ascension Parish.
“We know that many people have had their lives disrupted by the flooding in Louisiana,” said Malloy Evans, vice president of servicing at Fannie Mae. “Our servicers are committed to helping homeowners affected by natural disasters and we are grateful for their efforts to offer the appropriate assistance to families in need. Our thoughts are with all of those who have been impacted.”
Lenders originating loans that will be sold to Fannie Mae must verify the condition of the property if it is in the area affected by flooding. Additional lender guidelines can be found here [2].
Fannie encourages borrowers to reach out to their servicer as soon as possible for assistance. In addition, homeowners can reach out to Fannie Mae directly by calling 1-800-2FANNIE. For more information, visit www.knowyouroptions.com/relief [3].