Participation in Louisiana's "The Road Home" Grant Program for Repairs or Rebuilding

The Road Home grant program is operated by the state of Louisiana for homeowners affected by Hurricane Katrina and Hurricane Rita. As we communicated to Servicers with Freddie Mac-owned mortgages in Louisiana on September 1, 2006, we expect Servicers to participate in The Road Home grant program with respect to homeowners who elect the option of keeping their homes. We support Louisiana's goal through this program to encourage homeowners to rebuild their homes and their lives.

The Road Home

The Road Home program provides compensation to homeowners for losses to their homes and creates a grant disbursement process, facilitated by Servicers.

Important points to note:

• Under The Road Home program, homeowners do not have to bring their mortgage current before obtaining grant funds, but must comply with requirements of a recorded Covenant. The Covenant requires the homeowners to occupy the property for three years, to carry insurance, and to make any repairs in accordance with certain established standards.
• Freddie Mac Servicers should enter into a The Road Home Lender Memorandum of Understanding provided by the state of Louisiana, which outlines the terms and conditions for the disbursement of funds and the execution of documents relating to the Covenant. Servicers may obtain the required grant disbursement documents by contacting Bettsie Stapleton at estapleton@road2la.org
• Except as otherwise provided in the Memorandum of Understanding, Servicers must manage the disbursement account in accordance with the requirements of Section 58.10 of the Single-Family Seller/Servicer Guide for the management of insurance proceeds.
• This communication applies only to the option under the Road Home program in which the borrower elects to keep their property.
• Servicers should continue to work with borrowers and use all available Freddie Mac relief options and remedies in accordance with our temporary servicing requirements for the affected areas.

More Information

• Information about "The Road Home" can be found at http://www.road2LA.org.
• The Memorandum of Understanding and other documents related to the Road Home program can be obtained by contacting Bettsie Stapleton at estapleton@road2la.org
• Review Freddie Mac's complete Hurricane Katrina and Rita relief options and requirements for Sellers and Servicers.

Thank you again for your ongoing work to provide relief and solutions for borrowers coping with long-lasting hardships related to Hurricanes Katrina and Rita.