Foreclosure Prevention
At this critical time, foreclosure prevention remains one of Freddie Mac's top priorities. We believe it's the right thing to do for families, and the right thing for our company to do as a responsible steward of taxpayer support. Since the housing crisis began, we have helped more than 656,000 struggling borrowers avoid foreclosure through our own programs and the federal Making Home Affordable program. Of the borrowers we've helped, more than eight out of 10 were able to stay in their homes.
Freddie Mac has long been recognized as an industry leader in identifying and addressing delinquencies before they become foreclosures. In addition to helping borrowers through our loss mitigation tools, for years, we have worked closely with national nonprofits to educate borrowers about foreclosure prevention and mortgage fraud. We support these efforts through a number of online resources, including CreditSmart®, our award-winning financial literacy curriculum.
Our recent efforts to help as many families as possible include:
- Participating in hundreds of foreclosure prevention workshops nationwide.
- Opening borrower help centers to provide free counseling for distressed borrowers in cities especially hard hit by the foreclosure crisis, including Chicago, Phoenix and Washington, D.C.
- Partnering with nonprofits to hold direct-to-homeowner auctions of Freddie Mac-owned properties in cities across the country.
- Introducing a balanced servicer scorecard with a significant focus and weighting on early intervention and finding solutions for struggling homeowners.
- Implementation of the Servicing Alignment Initiative – including a new standard loan modification – to align servicing and delinquency management requirements.
Borrower Help Centers in Cities Hardest Hit by Foreclosure Crisis
Together with our non-profit partners, Freddie Mac operates walk-in counseling centers in areas with significant concentrations of at-risk borrowers in Phoenix, Chicago, Miami, Washington, D.C., and California.
These centers go beyond traditional mortgage counseling to provide borrowers with holistic credit counseling that assesses all of the debt and credit issues affecting their ability to pay their mortgage. The centers leverage trusted local resources in the hope of reducing the shattering impact of an avoidable foreclosure on personal lives and local communities.
We are seeing encouraging signs. Since their launch in late 2009, the centers have contacted more than 111,000 borrowers to try to reach them to explore their options for a home-retention workout through a short sale or deed-in-lieu.
Other innovative efforts underway include:
- Events sponsored by the U.S. Department of the Treasury and lenders in target markets that seek to reach delinquent borrowers before foreclosure occurs.
- National phone hotlines, like Freddie Mac's Borrower Help Network, that proactively contact delinquent borrowers and try to engage them in the workout process.