Processing flexibilities for many mortgages extended through July
The government-sponsored enterprises that play a large role in the U.S. mortgage market extended by one month some of the special procedures they've allowed in order to offset coronavirus-related risks.
The extension through at least July 31 comes following the release of mixed data related to the extent to which coronavirus cases and related economic woes have subsided.
An overall pessimistic read on the data, which shows slight improvement in the economy but a continued rise in the infection rate, drove a rout in the stock market Thursday.
The measures the GSEs extended include alternative methods used for appraisals on purchase and rate-and-term refinance loans, according to the their regulator and conservator, the Federal Housing Finance Agency. Alternative methods for verification of employment done before closing loans also will be extended.
Mortgage borrowers and lenders will additionally be able to continue to use power of attorney and remote online notarizations to fulfill loan closing requirements in conjunction with Fannie Mae and Freddie Mac loans.
Fannie and Freddie will also remain able to buy loans with forbearance through the end of next month.
The FHFA has said it would make adjustments to these temporary measures as is necessary.
FHFA Director Mark Calabria at a hearing this week said he plans to make a decision regarding the extension of the GSEs' foreclosure and eviction moratorium soon, but he had not yet done so at deadline.
Calabria has been working to balance the need to assist borrowers with financial distress caused by the coronavirus with the need to rebuild the GSEs' capital buffers so he can protect Fannie and Freddie’s finances as well.