Fannie & Freddie Stop Foreclosures for Christmas!

An early Christmas present for hundreds of Utah families in danger of losing their homes at the holidays. Fannie Mae and Freddie Mac are suspending their foreclosure sales and evictions until January.

Utah economist Jeff Thredgold says, "It's one step in this whole process of trying to stabilize housing markets." The latest move from the two mortgage giants is putting off foreclosure sales scheduled to happen during November 26th to January 9th. This means nearly 16,000 families nationwide are breathing sighs of relief knowing they won't get the boot during the holidays.

Holiday cheer does play a small part but the big reason for this hold off is to give these companies time to implement their mortgage stabilization program. Thredgold says, "Mortgage servicers are so confused as to what to do and what not to do because programs keep changing, new proposals are made, other proposals are tabled so it's really in part just the idea of letting people catch their breath and they're supposed to do and not supposed to do."

The program targets high risk borrowers, the ones who have missed three payments or more, owns and lives in the house, and have not filed for bankruptcy. Part of the fast track method to affordable monthly payments could be extending the life of the loan, reducing the interest rate, or even deferring payments on part of the principal. Freddie Mac CEO David Moffett says, "By delaying these foreclosure sales, the nation's servicers will have the opportunity to work with more borrowers who could qualify for a modification under the new program."

But Utahns in this situation need to know this is not a time to kick their feet up and think the problem is fixed. Foreclosures will continue after the new year. Thredgold says, "You can just sit back and say boy we dodged a bullet because that's not the case."

The Streamlined Modification Program will launch December 15th. If you have a Fannie Mae or Freddie Mac loan, and fall into the November 26th to January 9th foreclosure schedule, you'll be notified by the attorney handling your case.