FHFA Suspends Mortgage Foreclosures

Homeowners with Fannie Mae or Freddie Mac-backed mortgages were granted a reprieve of two additional months to avoid foreclosure if they applied for financial help from the Homeowner Assistance Fund, the Federal Housing Finance Agency (FHFA) has announced.

The FHFA said Wednesday it will require mortgage servicers to suspend foreclosure activities up to 60 days if the servicer has been notified that a borrower applied for assistance from the Treasury Department’s Homeowner Assistance Fund.

According to the Treasury Department’s website, the Homeowner Assistance Fund provides nearly $10 billion to help the country’s most vulnerable homeowners. Assistance from the fund can help homeowners pay mortgages and utilities, the Treasury Department’s website says.

“This action is the latest step FHFA has taken to benefit homeowners and the mortgage market during the pandemic,” the agency said in its news release.

According to an FHFA spokesman Adam Russell, as of Dec. 31, 2021, there were 178,019 mortgages in forbearance, down from 320,009 in the third quarter of 2021. The numbers include only those mortgages that are backed by either Fannie Mae and Freddie Mac.

The FHFA reports that the leading states with Fannie Mae- and Freddie Mac-backed mortgages in forbearance include California and Texas, with more than 20,000 and nearly 17,000 mortgages, respectively, behind in payments.