Freddie Mac has announced a Streamlined Loan Modification that should provide an efficient way for borrowers to avoid foreclosure and remain in their home. The Freddie Mac Streamlined Modification program is a temporary initiative that provides severely delinquent, eligible borrowers an opportunity to avoid further stages of delinquency quickly and without documentation. The Streamlined Loan Modification enables Freddie Mac Servicers to modify a borrower’s mortgage by adjusting interest rates, extending payment terms to 40 years, and providing principal forbearance for certain underwater borrowers.
Some of the key features of the Streamlined Loan Modification include the same terms as the Freddie Mac Standard Modification program. Freddie Mac introduced an alternative to foreclosure that targets severely delinquent borrowers and eliminates the requirement for borrowers to submit a Borrower Response Package. The Streamlined Loan Modification offers a trial period plan in accordance with the Single-Family Seller/Servicer Guide. In addition, it includes eligibility requirements designed to discourage borrowers from purposely missing payments to obtain the Freddie Mac Streamlined Modification. The Streamlined Modification may be offered to eligible borrowers immediately, and must be offered beginning July 1, 2013.
The benefit of the Streamlined Loan Modification includes the reduction of paperwork and, it shortens the process of securing a permanent mortgage modification for struggling borrowers. The program also creates a sustainable monthly payment in a simple, straightforward manner. And, it provides distressed homeowner clients with an additional modification option to help them avoid further stages of delinquency.
If you need more information or would like to be considered for the Streamlined Loan Modification program, contact your mortgage lender directly to start the process.