Skip to main content

Temporary Policy Allowing Purchase Of Qualified Loans In Forbearance Extended

Aug 03, 2020
FHFA hq
Senior Editor

To support homeowners and mortgage lenders, the Federal Housing Finance Agency approved an extension of the temporary policy that allows for the purchase of certain single-family mortgages in forbearance that meet specific eligibility criteria set by Fannie Mae and Freddie Mac. The policy is extended for loans originated through Aug. 31, 2020.
 
Earlier this year, FHFA and the Consumer Financial Protection Bureau announced the Borrower Protection Program to ensure borrowers are protected during the coronavirus national emergency and facilitate related information sharing. To ensure that borrowers are qualifying for mortgages they can afford, FHFA will be sharing with the CFPB aggregated data on loans that enter forbearance before delivery to the Enterprises. The data sharing will allow FHFA to fulfill its obligation under the so-called “QM Patch” to ensure that loans sold to the Enterprises are complying with the intent of Dodd-Frank’s ability to repay provisions.
 
“Extending the Enterprises' ability to purchase these previously ineligible loans will help provide liquidity to mortgage markets. That said, to make homeownership sustainable, lenders have a responsibility to ensure that borrowers can make their monthly mortgage payment," said FHFA Director Mark Calabria.
 
During the COVID-19 pandemic, some borrowers have sought payment forbearance shortly after closing on their single-family loan and before the lender could deliver the mortgage loan to the Enterprises. Normally, mortgage loans in either forbearance or delinquency are ineligible for delivery under Enterprise requirements. In April, FHFA announced a temporary policy of allowing certain single-family mortgages in forbearance to be delivered. 
 
The extension continues this policy for loans originated through Aug. 31, 2020. Eligible loans will continue to be priced to mitigate the heightened risk of loss to the Enterprises from these loans. These prudential measures also ensure fulfillment of the Enterprises' charter requirements to only purchase loans that meet the purchase standards imposed by private, institutional mortgage investors.
 
FHFA will continue to monitor the coronavirus' impact on renters, borrowers, and the mortgage market and update policies as needed.
 
About the author
Senior Editor
Keith Griffin is a senior editor at NMP.
Published
Aug 03, 2020
HUD Freezes Foreclosures On FHA Mortgages In Texas Flood Zone

Kerr County homeowners among hardest hit in disaster that’s claimed more than 100 lives

Jul 09, 2025
Fewer Canadians Hunt For U.S. Property

Largest component of international buyers in U.S. takes more than 25% hit

Jul 08, 2025
Fannie, Freddie Now Allow Lenders To Use VantageScore 4.0

Lenders will keep tri-merge credit scoring model; what this shift means

Fairway Independent Mortgage Corporation Announces Rebranding

Now Fairway Home Mortgage, company also donates $1M to support relief efforts in deadly Texas flooding

Jul 07, 2025
FHFA Chief Officially Calls For Investigation Of Federal Reserve Chairman Powell

Alleges Powell lied in testimony to Congress regarding Fed building renovations, says Fed Chair should be fired

BBB Will Impact Homeowners, Buyers

U.S. House and Senate must agree on certain tax, mortgage insurance premium deductions