Good News for Borrowers Who Are in COVID-19 Forbearance
Updated: May 22, 2020
The Federal Housing Finance Agency has announced that Fannie Mae and Freddie Mac borrowers in forbearance (delaying a foreclosure) can apply for refinancing and new purchase mortgages once their loans are current.
Why is this important? Well, this process waives a previous mandatory wait of 12 months, allowing for faster access to record-low rates.
According to the FHFA, borrowers are eligible to refinance or buy a new home three months after their forbearance ends if they have made three consecutive payments under their repayment plan, payment deferral option or loan modification.
"Homeowners who are in COVID-19 forbearance, but continue to make their mortgage payment, will not be penalized," said FHFA Director Mark Calabria. "Today's action allows homeowners to access record low mortgage rates and keeps the mortgage market functioning as efficiently as possible."