New Freddie Mac Policy Might Provide Relief To Unemployed Homeowners
January 13th, 2012 categories: Chicago Real Estate News
Unemployed homeowners who are struggling to make their mortgage payments each month might gain some relief thanks to a new policy by Freddie Mac. According to a report by CBS’ MoneyWatch, unemployed homeowners with Freddie Mac-backed mortgage loans might not have to make a mortgage payment for as long as a year if they are struggling financially.
Freddie Mac will soon give mortgage servicers the authority to offer as much as one year of mortgage forbearance to unemployed homeowners with Freddie Mac-backed mortgage loans.
The arrangement works like this: Mortgage servicers can allow unemployed homeowners to live in their homes for six months without making mortgage payments. They can then offer unemployed borrowers six more mortgage-payment-free months if Freddie Mac gives its approval.
This change will take place Feb. 1, according to the MoneyWatch story. Under the current system, mortgage loan servicers can offer unemployed homeowners up to three months of no mortgage payments without approval from Freddie Mac or six months of reduced mortgage payments if they first receive permission from Freddie.
The change will undoubtedly be a financial relief to struggling, unemployed homeowners. And fortunately, the news on the unemployment front has actually been good lately.
The U.S. Department of Labor announced that the country added 325,000 jobs in December. At the same time, the nation’s unemployment rate fell to 8.5 percent in December. That’s a three-year low. It’s also a sign that companies may boost their hiring in 2012.
If that’s the case, then perhaps the rate of housing foreclosures in Chicago and the rest of the country will fall. And maybe Freddie Mac’s decision to allow homeowners a year’s break from making mortgage payments will buy these homeowners enough time to restore their financial health.
Even with the positive jobs numbers, the country still has a long way to go to fully recover from the Great Recession. But at least today the news isn’t quite so glum. That can only mean good things for the housing market, both locally and nationally.
This is good news to home owners who are suffering from financial hardship. Hopefully more programs like this will come into the market reducing the flow of foreclosures. That way the market will stabilize.
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