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Suspension of Foreclosure Sales and Evictions Extended Through January 31, 2009

January 8, 2009 Single Family Advisory

Today, Freddie Mac announced the extension of a suspension of all foreclosure sales and scheduled evictions on occupied single family 1-4 unit residences with Freddie Mac-owned mortgages. Originally effective November 26, 2008 through January 9, 2009, the suspension is extended through January 31, 2009. This extension reinforces our commitment to pursue every responsible opportunity to avoid preventable foreclosures. Servicers of Freddie Mac-owned mortgages now have more time to help delinquent borrowers and implement the Streamlined Modification Program that Freddie Mac jointly announced with the FHFA, Fannie Mae and representatives of the HOPE NOW Alliance on November 11, 2008.

At this critical time for the market and homeowners, today's announcement and the extension of the temporary servicing requirements outlined below reinforce our long-standing commitment of working with you to help borrowers successfully maintain long-term equity through homeownership. With this extension:

  • Servicers must postpone foreclosure sales on eligible Freddie Mac-owned mortgages scheduled between November 26, 2008 through January 31, 2009. You should continue to refer delinquent mortgages to foreclosure and process the foreclosure proceedings. However, Servicers must ensure that a foreclosure sale is not scheduled to occur until after the suspension period has expired.

  • At the end of the suspension period, Servicers must determine whether additional foreclosure relief should be extended to allow time for a workout in process to be completed or whether the Servicer should proceed with foreclosure sale. Servicers are not required to seek approval from Freddie Mac to proceed with foreclosure sales after January 31, 2009, if the Servicer has determined that a successful alternative to foreclosure is not possible.

  • To prevent negative impacts to individual Servicers' Performance Profile by mortgages for which foreclosure has been postponed under these temporary provisions, Servicers must report Default Action Code "09-Forebearance" through Electronic Default Reporting.

  • Servicers must manage the need for additional fees and costs associated with the suspension and, in accordance with the requirements of Section 66.69 of the Single-Family Seller/Servicer Guide (Guide), obtain our approval to exceed the expense guidelines set forth in Exhibit 57, 1- to 4- Unit Property Approved Expense Amounts, and Exhibit 57A, Approved Attorney Fees and Title Expenses, by submitting Form 105 to Freddie Mac at overallowables@freddiemac.com.

These special foreclosure provisions will be incorporated into a Single-Family Seller/Servicer Guide Bulletin at a later date.

As always, we thank you for your ongoing efforts to preserve the dream of homeownership for troubled borrowers with Freddie Mac-owned mortgages, wherever possible.

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© 2012 Freddie Mac

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