Fannie Mae and Freddie Mac

FHFA Further Extends COVID-Related Loan Flexibilities

 

On February 10, Fannie Mae and Freddie Mac will extend several loan origination flexibilities until March 31, 2021, including (1) alternative appraisals on purchase and rate term refinance loans; (2) alternative methods for documenting income and verifying employment before loan closing; and (3) expanding the use of power of attorney to assist with loan closings. These flexibilities aim to support borrowers impacted by the COVID-19 pandemic. Release.

FHFA Extends Foreclosure and REO Eviction Moratoriums and COVID Forbearance Period

 

On February 9, The Federal Housing Finance Agency (FHFA) announced that Fannie Mae and Freddie Mac (the “Enterprises”) are extending moratoriums on single-family foreclosures for Enterprise-backed, single-family mortgages. Moratoriums on REO eviction for properties that have been acquired by an Enterprise through foreclosure or deed-in-lieu-of-foreclosure transactions are also extended. These moratoriums are extended until March 31, 2021. Further, borrowers with a mortgage backed by Fannie Mae or Freddie Mac may be eligible for an additional forbearance extension of up to three months, and COVID-19 Payment Deferral for borrowers with an Enterprise-backed mortgage can now cover up to 15 months of missed payments. Release.

Temporary Policy Allowing Purchase of Qualified Loans in Forbearance is Extended

 

On October 21, the Federal Housing Finance Agency (FHFA) extended a policy allowing certain single-family mortgages in forbearance to be delivered to Fannie Mae and Freddie Mac for borrowers who sought payment forbearance due to the impact of COVID-19 shortly after closing on their single-family loan. Normally, mortgage loans in either forbearance or delinquency are ineligible for delivery. The policy was extended for loans originated through November 30, 2020. Release.

Adverse Market Refinance Fee Implementation Now December 1

 

Fannie Mae and Freddie Mac have postponed the implementation date of their Adverse Market Refinance Fee from September 1 to December 1, per direction from the Federal Housing Finance Agency (FHFA). Certain Fannie Mae and Freddie Mac loans will also be exempt from the Adverse Market Refinance Fee. The fee is intended to cover costs to Fannie Mae and Freddie Mac associated with protections extended to renters and borrowers affected by COVID-19. Release.

FHFA Provides Tenant Protections

 

On June 29, the Federal Housing Finance Agency (FHFA) provided additional protections for owners and renters of multifamily properties by allowing servicers to extend existing forbearance agreements for up to three months, for a total forbearance of up to six months for multifamily property owners with loans backed by Fannie Mae and Freddie Mac. Borrower may qualify for up to 24 months to repay the missed payments once the forbearance period concludes, and borrowers must comply with additional tenant protections during this period. Release.

CFPB Issues Proposals to Amend Qualified Mortgage Definition and Extend GSE Patch

 

On June 22, the CFPB issued two notices of proposed rulemaking (NPRMs) regarding the Qualified Mortgage (QM) exemption from the ability-to-repay requirements of Regulation Z. The first proposal would, among other changes, revise the general QM loan definition by replacing the QM borrower debt-to-income ratio limit with a price-based approach to determining loan eligibility. The second proposal would extend the current January 2021 sunset date in the provision granting QM status to mortgages eligible for purchase by Fannie Mae or Freddie Mac (the “GSE Patch”) to the date on which the amendments to the general QM loan definition become effective. Comments on the NPRM to revise the general QM loan definition are due 60 days following publication in the Federal Register. Comments on the NPRM to extend the GSE Patch are due 30 days following publication. Release. NPRM (General QM Loan Definition). NPRM (GSE Patch Extension).

FHFA Extends Loan Processing Flexibilities for Fannie Mae and Freddie Mac Customers

 

On May 5, the Federal Housing Finance Agency (“FHFA”) extended loan origination flexibilities offered by Fannie Mae and Freddie Mac until at least June 30th. The extended flexibilities aim to help borrowers during the COVID-19 pandemic by facilitating loan closings and include: (1) alternative appraisals on purchase and rate term refinance loans; (2) alternative methods for verifying employment; and (3) expanding the use of power of attorney and remote online notarizations. Release.

FHFA Suspends Foreclosures and Evictions for Enterprise-Backed Mortgages

 

On March 18, the Federal Housing Finance Agency (FHFA) and the U.S. Department of Housing and Urban Development (HUD) made a joint announcement to suspend all foreclosures and evictions for homeowners with mortgages backed by Freddie Mac and Fannie Mae for 60 days. The moratorium on evictions and foreclosures aim to provide relief for borrowers impacted by the coronavirus pandemic. FHFA Release. HUD Release. CFPB Release.

FHFA Strengthens Evaluation Criteria for GSE’s Duty to Serve Program

 

On March 11, the Federal Housing Finance Agency (FHFA) issued revised guidance for evaluating Underserved Markets Plans submitted by Fannie Mae and Freddie Mac (the “GSEs”) for FHFA approval under the Duty to Serve regulation. The revised guidance strengthens the criteria for determining GSE compliance with the regulation, including through a revised ratings framework and higher expectations for impactful plans. Revised Guidance.