The Federal Housing Finance Agency (FHFA) today announced that Fannie Mae and
Freddie Mac will offer a new, simplified loan modification initiative to
minimize losses and to help troubled borrowers avoid foreclosure and stay in
their homes. Beginning July 1 2013, servicers will be required to offer
eligible borrowers who are at least 90 days delinquent on their mortgage an
easy way to lower their monthly payments and modify their mortgage without
requiring financial or hardship documentation.
The new Streamlined Modification Initiative eliminates the administrative barriers
associated with document collection and evaluation. Eligible borrowers must
demonstrate a willingness and ability to pay by making three on-time trial
payments, after which the mortgage will be permanently modified. Homeowners are
encouraged to continue working with their servicer to evaluate all of their
foreclosure prevention options. Documenting income and financial hardship could
result in a modification with additional savings for the borrower.
The Streamlined Modification Initiative builds on the principles of the Servicing
Alignment Initiative by encouraging servicers to resolve delinquencies earlier
and in a more consistent and expeditious manner to keep more people in their
homes and to minimize losses to Fannie Mae, Freddie Mac and taxpayers. The
program expires August 1, 2015.
The program is available to those homeowners with loans owned or guaranteed by
Fannie Mae or Freddie Mac. Since being placed into conservatorships, Fannie Mae
and Freddie Mac have completed 2.7 million foreclosure prevention transactions,
including 1.3 million loan modifications. We surely want fewer people foreclosed
and if there’s a way to modify mortgages that makes financial sense for both
lenders and borrowers then you should contact our office at 305-227-4030 to
discuss the matter further.
Ray Garcia, Esq.
Board Certified in Real Estate Law
By The Florida Bar
Law Office of Ray Garcia, P.A.
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