Hurricane Sandy rocked much of the east coast but disproportionately affected the states of New York, New Jersey and Connecticut. Now, homeowners in the path of the storm who have mortgages backed by one of the nation’s government-sponsored giants may be able to find some relief.
Freddie Mac is now alerting mortgage servicers across the country that consumers whose homes were damaged or destroyed by Hurricane Sandy in federally designated major disaster areas should receive the full benefits of its relief policies, the company recently announced. These policies will provide a number of options to consumers who were hurt by the storm, when it comes to making sure they can handle all their mortgage obligations.
“Freddie Mac has authorized the nation’s mortgage servicers to provide a full range of mortgage relief options to affected borrowers with mortgages owned or guaranteed by Freddie Mac,” said Tracy Mooney, senior vice president of single-family servicing and real estate owned at Freddie Mac. “Forbearance on mortgage payments for up to one year is one of several options our servicers have been instructed to offer borrowers on a case-by-case basis.”
In particular, Freddie recommended that mortgage servicers choose to first suspend foreclosure proceedings and evictions in affected areas for as much as 12 months, the report said. It also said these companies should waive all penalties or late fees against borrowers whose homes were damaged in the natural disaster, and also not report any forbearances or delinquencies to the nation’s credit bureaus.
Further, it recommended that homeowners should call either their mortgage servicer or Freddie Mac itself if they have any questions about their obligations or the kinds of relief for which they may be able to qualify, the report said. It also has more general information about its disaster relief policies listed on its website for those whose questions may be more basic.
Several other financial institutions, including some of the nation’s largest banks and credit card lenders, are likewise instituting a number of policies designed to make it easier for those who were rocked by the massive storm to deal with their various obligations while they work to put their finances back together. Many of these relief efforts involve waiving late fees and not reporting delinquency to credit bureaus.
Image: The U.S. Army, via Flickr