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Monday, September 27, 2010

Freddie Mac CEO: We will try almost anything to avoid foreclosure

Haldeman said that normally, if a borrower gets ill or loses their job, Freddie will traditionally use forbearance for six months and then the payments that are forborne are restructured into a new monthly payment going forward once the borrower recovers or gets a new job.
And this comment, I bet it's going to take a real long time for foreclosures to hit market.
The thought process is that foreclosure is a very expensive proposition for the investor. Therefore, if we can make a modification or adjustment that is significant but that keeps the homeowner in the home, then often the investor is better off economically."
Haldeman estimates that Freddie currently owns 25% of the total U.S. mortgage market. And, the more foreclosures there are, the more pressure on house prices there is and the more vulnerable Freddie Mac's mortgage book becomes.
Also look at this right to rent program US congress is concerning for homeowners.  I never realized that delinqent home owners had so mcuh power.

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