Some Struggling Homeowners Will Keep Homes for the Holidays

Freddie Mac and Fannie Mae, two of the nation’s largest mortgage finance companies, have announced they will be halting foreclosure actions for a combined 16,000 households during the holidays. They’ll be taking a break from foreclosure sales from November 26 until January 9.
The two companies will spend the holidays figuring out whether mortgage borrowers qualify for a newly announced loan modification program. The program would help Freddie and Fannie struggling homeowners who are at least three months late on their mortgage payments, have not filed for bankruptcy, and still occupy the home secured by the mortgage. The program only benefits Freddie and Fannie borrowers.

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According to Fannie Mae’s press release, the mortgages would be made affordable through a combination of efforts: reducing the interest rate, extending the loan, or deferring some principle payments. Qualifying borrowers would see their payments fall to 38% of their gross income or less. The program is scheduled to launch on December 15, 2008.
Fannie Mae and Freddie Mac borrowers who have foreclosures scheduled between November 26 and January 9 will be contacted by one of the companies’ foreclosure attorneys. If the foreclosure-scheduled homes are unoccupied, foreclosure will proceed.