Struggling homeowners are getting a big break this summer from Freddie Mac’s and Fannie Mae’s Streamlined Modification program.
Eligible borrowers won’t have to submit documentation, but can accept a Streamlined Modification offer simply by making the trial period payments. The modification becomes permanent once the borrower demonstrates their ability to pay by completing the trial period.
The Streamlined Modification will target borrowers who are at least 90 days delinquent on mortgages that are at least 12 months old, and meet other eligibility criteria. The program starts July 1, 2013.
to Start July 1, 2013
Freddie Mac says its Streamlined Modification offers the same mortgage terms as the Standard Modification Freddie Mac announced in September 2011, which enables servicers to reduce a borrower’s monthly mortgage payment by adjusting interest rates, extending payment terms to 40 years, and providing principal forbearance for certain underwater borrowers.
“The Streamlined Modification will open a new gateway to mortgage relief for many of America’s struggling borrowers. Starting July 1, 2013 servicers will proactively offer eligible borrowers a Streamlined Modification, which can cut monthly mortgage payments by as much as a standard modification but with less documentation,” said Tracy Mooney, Senior Vice President, Servicing and REO at Freddie Mac.
Freddie Mac says it and its servicers have helped more than 785,000 distressed borrowers avoid foreclosure through mortgage modifications, forbearance, repayment plans, short sales and deeds-in-lieu since 2009.
Freddie Mac also claims it helped more than 1.8 million families make home ownership more affordable through the Freddie Mac Relief Refinance program, which includes the Home Affordable Refinance Program (HARP).