In late March, HousingWire reported the Federal Housing Finance Agency would expand its suite of mortgage modification tools for Fannie Mae and Freddie Mac servicers.
As of July 1st, the Streamlined Modification Initiative is in effect, in order to encourage servicers to handle delinquencies earlier, minimizing losses to the GSEs and taxpayers, while cutting back some of the red tape that slows down the traditional approval process.
Borrowers who are 90-days late on their Fannie/Freddie first mortgage will receive a 4% fixed-rate payment (as long as it is lower than the current payment and the LTV is above 80%).
All eligible borrowers must make three on-time trial payments, the FHFA said. Once those payments are made, the loan modification takes permanent effect.
No documentation is required. The program expires Aug. 1, 2015.