Foreclosure Freeze Continues

This is somewhat old news (from last Friday), but Fannie and Freddie have extended their foreclosure freeze.  From the AP via Newsday:

MCLEAN, Va. (AP) — Government-controlled mortgage finance companies Fannie Mae and Freddie Mac said Friday they have immediately suspended all foreclosure sales involving occupied single-family and 2-4 unit properties through March 6, to give troubled borrowers more time to work with loan servicers to avoid losing their homes.

J.P. Morgan Chase, Citigroup and Bank of America have also placed a moratorium on foreclosures. From the Wall Street Journal:

WASHINGTON — J.P. Morgan Chase & Co., Citigroup Inc. and Bank of America Corp. have committed to weeks-long moratoriums on foreclosures as the government works on a financial stability plan slated to include billions of dollars aimed at keeping people in their homes.

“We will not add to the foreclosure process any new owner-occupied residential loans that are owned and serviced by J.P. Morgan Chase,” the company’s chief executive, Jamie Dimon, said in a letter Thursday to Rep. Barney Frank (D., Mass.), chairman of the House Financial Services Committee.

Sorry for the late breaking news. I mean late in the literal sense!

Lenders Put Foreclosures on Hold for 30 Days

Lenders are in a bind. With foreclosures increasing every day, their REO departments are overloaded. Foreclosure is expensive and banks are in no mood to be property owners. So, why not just try to work thing out with the distressed borrower? That seems to be the line of thinking as major lenders have announced that they will put foreclosures on hold for 30 days. During this time they will work with the borrower to figure a workable solution for both parties. This applies to all kinds of borrowers, not just subprime. From MSNBC:

These lenders say they will contact homeowners who are 90 or more days overdue on their monthly mortgage payments. They will be given the opportunity to put the foreclosure process on pause for 30 days while the lenders try to work out a way to make the mortgage more affordable to the homeowner.

To clarify, this appears to be a voluntary program and is not a “law”. Which means a lender has the last word and is not under any obligation to award the 30 day freeze. If you think you qualify contact your lender directly.

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