In the wake of Louisiana’s devastating flooding, Fannie Mae has given its mortgage servicers leeway to grant periods of forbearance, or the postponement of legal action on the delinquent payment of a loan, to borrowers in affected areas.
Under Fannie Mae’s disaster relief guidelines, servicers may suspend or reduce mortgage payments for up to ninety days for homeowners affected by disaster, and offer forbearance for up to six months if they can contact the homeowner – plus an additional six months if the homeowner was current on their payments.
“Our servicers are committed to helping homeowners affected by natural disasters and we are grateful for their efforts to offer the appropriate assistance to families in need,” said Mallory Evans, vice president of servicing at Fannie Mae. “Our thoughts are with all of those who have been impacted.”
Freddie Mac offers a similar option to home buyers affected by natural disasters, in which forbearance can be granted for up to one year. The IRS has also granted relief to taxpayers in affected Louisiana parishes.