Freddie Mac Now Grants Unemployed 12 Months Forbearance

Clock jumping in the air
Freddie Mac announced Friday that it will giving mortgage loan lenders the authority to grant six months forbearance to any unemployed borrower without Freddie Mac’s prior approval. If the lender does receive prior approval from Freddie Mac, they may be awarded with an additional six months forbearance, bringing the total to one full year of foreclosure postponement while the home loan holder finds a job.
In light of the troubled job economy, this move may be the perfect answer to families struggling to find a job after being laid off, as almost 10 percent of all delinquencies reported on Freddie Mac mortgage loans were a result of unemployment.
“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 for Freddie Mac, in a press release. “We believe this will put more families back on track to successful long-term homeownership.
Even those who are currently in a forbearance program may qualify for this unemployment forbearance program.
Previously, Freddie Mac allowed its lenders to grant up to three months of home loan forbearance with no pre-approval, or six months total with Freddie Mac’s prior consent. But now those times will be doubled, granting the unemployed more room to secure a job while maintaining hold of their property.
Those who are disabled or victims of certain uncontrollable events, such as natural disasters, are still eligible to apply for even longer forbearance terms—but those programs are handled on a case-by-case basis and is something individual borrowers should discuss with their lenders.
These new home loan forbearance options for the unemployed are scheduled to take effect on February 1, 2012.