Foreclosures take a holiday

November 21, 8:52 AMResidential Real Estate ExaminerMichele Lerner

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Fannie Mae and Freddie Mac agreed yesterday to temporarily suspend all foreclosures and evictions from November 26 to January 9. The holiday break will allow borrowers in trouble to enter into a new loan modification program.

According to The Washington Post this program will benefit as many as 16,000 borrowers.

For borrowers to qualify, they must be 90 days behind in their loan payments or the home should already in the process of foreclosure. The new mortgage will not be more than 38% of the pretax salary of the borrowers. The Fannie Mae/Freddie Mac program will allow loans to be extended to as along as 40 years and interest rates can be reduced. The principal still owed on the current loan can be reduced for some period of time but will have to be paid back eventually.

The new loan program is slated to begin December 15. Borrowers in foreclosure should be contacted by their lenders, but any borrower in trouble with their loan payments should contact their lender to determine if they qualify for this program or others in place to prevent foreclosures.