The federal government continues refining the lifelines it's extending to the troubled housing market through the government-sponsored enterprises (GSEs) that buy trillions of dollars in mortgages and back them in the investor market.
The Federal Housing Finance Agency (FHFA) announced Wednesday, May 13, that Fannie Mae and Freddie Mac are offering payment deferrals as a new option for borrowers whose mortgages are in forbearance because of the coronavirus pandemic.
Mortgage servicers will begin offering the deferral option on July 1. It allows borrowers who are able to resume making normal monthly payments to choose to make up their missed payments when the home is sold or refinanced or the mortgage note matures.
An obligation deferred is an obligation that remains
"For homeowners in forbearance due to COVID-19, payment deferral allows them to make up missed forbearance payments when they sell their home or refinance," FHFA Director Mark Calabria said in the announcement.
"This new forbearance repayment solution responsibly simplifies options for homeowners while providing an additional tool for mortgage servicers," Calabria said. "Borrowers who can pay their mortgage should, because missed payments remain an obligation that will ultimately have to be repaid."
That July 1 date appears to have been chosen because it's approximately when many of the forbearance agreements lenders have granted borrowers will be at or near expiration.