Temporary foreclosure moratorium issued for some service members

If you are a veteran, active duty service member, or surviving spouse, and you are having difficulty making your mortgage payments, it is imperative that you contact your mortgage servicer immediately.  

Freddie Mac issued a statement to its mortgage servicers last month to delay the initiation of foreclosure proceedings against military service members, who are released from active duty for a period of nine months from the time of discharge, through the end of 2011.  

This is an attempt by Freddie Mac to give additional time to its mortgage servicers to assist borrowers in preventing the loss of their home to foreclosure.  However, this program by Freddie Mac only applies to those service members who have a Freddie Mac-owned mortgage.

Fannie Mae announced last September its effort to assist surviving spouses and wounded warriors who may be struggling with their mortgage payments, to prevent foreclosure as well.  

The “Unique Hardships” program enables eligible wounded warriors and surviving spouses to either reduce or suspend their monthly mortgage payments for a six-month period.  Also, as part of the program, any reporting to credit bureaus for late or missed mortgage payments would also be suspended during the specified six-month period.  

Fannie Mae also created a special hotline number (877-MIL-4566) and a new consumer education website, knowyouroptions.com, to provide struggling homeowners with additional resources and guidance.

In addition, the Department of Veterans Affairs also has counseling and other resources available, although it is limited in the assistance it can provide to military members with non-VA loans.