Federal mortgage backers Fannie Mae and Freddie Mac announced this week that they will halt evictions of foreclosed homes during the holidays.
For Fannie Mae-backed mortgages, the suspension on evicting homeowners will be between Dec. 19 and Jan. 2.
For Freddie Mac-backed mortgages, the suspension on evicting homeowners will be between Dec. 17 and Jan. 2.
The eviction and lockout suspensions have become a yearly tradition for the two government-sponsored entities since the real-estate bust left hundreds of thousands of homeowners facing the loss of their homes during the holidays.
“We're taking this step in support of families who have faced financial challenges and gone through a foreclosure,” said Terry Edwards, executive vice president of credit portfolio management at Fannie Mae, in a press release. “The holidays are a chance to be with loved ones, and we want to relieve some stress at this time of year. We encourage homeowners having difficulty to reach out for help as soon as possible.”
The eviction suspensions do not impact other foreclosure-related activities.
“While I applaud the eviction moratorium, the two-week suspension does little to address rampant problems in the foreclosure process itself,” said Carlos Reyes, a nationally known foreclosure defense attorney from Fort Lauderdale, Fla. “All it does is delay the inevitable.”
According to Fannie Mae and Freddie Mac, foreclosure processes and related legal proceedings may continue, but the actual eviction will not take place during the moratorium.
Fannie Mae and Freddie Mac previously announced a 90-day moratorium on foreclosure sales and evictions in areas affected by Superstorm Sandy. The suspension for storm victims will last through Feb. 1.
Bill Lewis is the principal of William E. Lewis Jr. & Associates and host of “The Credit Report with Bill Lewis” — a daily forum for business and financial news, politics, economic trends and issues on AM 740 WSBR in south Florida.