Fannie Mae Updates Unemployment Forbearance Policies

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On June 4, Fannie Mae issued Servicing Guide Announcement SVC-2014-10, which updates policies related to unemployment forbearance. The announcement states that, effective immediately, a servicer may approve a borrower for the initial unemployment forbearance program provided that (i) the borrower’s mortgage payment is in imminent default or the mortgage loan delinquency is less than or equal to 12 months as of the evaluation date; and (ii) all other applicable eligibility requirements are met. In addition servicers are authorized to approve a compliant unemployment forbearance extension without approval from Fannie Mae. If the loan does not meet the eligibility requirements and the servicer believes, based on the borrower’s circumstances, that unemployment forbearance is appropriate, the servicer must submit a recommendation for approval.  The initial unemployment forbearance period that may be offered is the lesser of six months or upon notification from the borrower of employment.

 

Topics:  Borrowers, Delinquent Borrowers, Fannie Mae, Forbearance Agreements, Loan Servicer, Mortgage Loan Servicing Standards, Unemployment

Published In: Consumer Protection Updates, Finance & Banking Updates, Residential Real Estate Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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