The much-anticipated proposal, which would not go into effect until after Fannie Mae and Freddie Mac are privatized, reflects Director Mark Calabria’s aggressive efforts to get the companies on a strong financial footing.
Director Mark Calabria, who abandoned the Fannie and Freddie capital proposal written by his predecessor, said he expects a revised framework to be ready “very soon.”
The Federal Housing Finance Agency clarified that borrowers with Fannie Mae- or Freddie Mac-backed mortgages who have entered into forbearance plans can be eligible for a refi or new purchase once they are considered “current” on their mortgage.
The agency's announcement came one day after the agency said it would provide borrowers struggling to stay current with an additional payment deferral option.
Fannie Mae and Freddie Mac are now able to buy loans in forbearance to alleviate pressure on the sector, but the fees charged by the mortgage giants to assume more risk could turn away some originators.
The FHFA's director said the announcement is meant to “combat ongoing misinformation” about efforts to let homeowners skip mortgage payments due to the coronavirus pandemic.
The bureau said it began developing the standards before the coronavirus pandemic. But more transfers may occur as some servicers struggle to meet their obligations during their economic downturn.
The policy move will allow small institutions participating in the Paycheck Protection Program to pledge business loans as collateral to obtain advances.
