Realtor.com is reporting that mortgage finance firm Freddie Mac will give unemployed borrowers a break on their mortgage for up to one year.
Borrowers can be given up to a yearlong break from payments under the new policy. The forbearance is offered in two ways. First, starting on the first of February, mortgage servicers can allow borrowers to abstain from paying mortgages for as long as 6 months, getting Freddie Mac’s prior approval. After that, Freddie Mac can permit another six months.
"These expanded forbearance periods will provide families facing prolonged periods of unemployment with a greater measure of security by giving them more time to find new employment and resolve their delinquencies," said Tracy Mooney, senior vice president of single-family servicing and REO at Freddie Mac.
"We believe this will put more families back on track to successful long-term homeownership,” Mooney adds.
Freddie said the new deal expands the powers of mortgage servicers. The edict gives servicers the ability to forebear a mortgage for six months without prior approval. Freddie Mac can approve an additional six months after that.