Freddie Mac Single-Family Seller/Servicer Guide §8404.1 — Servicing Mortgages impacted by a disaster (05/01/26)
Freddie Mac Guide §8404.1 (Servicing Mortgages impacted by a disaster). Gap-fill (verbatim, ID-diff).
Verbatim regulatory text
Verbatim provisions from Freddie Mac Single-Family Seller/Servicer Guide §8404.1 — Servicing Mortgages impacted by a disaster (05/01/26) — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.
Freddie Mac Guide 8404.1
(05/01/26) Refer to Bulletin 2026-2, which announced updates related to Resolve® reporting requirements for repayment plans and forbearance agreements. Servicers may implement the new requirements prior to the mandatory October 1, 2026 version of this section if they are operationally ready to do so. This section contains information related to: ■ Overview of Servicer responsibilities following a disaster ■ Property protection activities following a disaster ■ Insurance loss settlements after an Eligible Disaster ■ Delinquency management activities following a disaster ■ Disaster reporting requirements ■ Transition following disaster-related forbearance (a) Overview of Servicer responsibilities following a disaster This chapter provides Servicers with our requirements for assisting Borrowers whose Mortgaged Premises or places of employment are located in an Eligible Disaster Area. A disaster may be a natural disaster (e.g., an earthquake, flood or hurricane) or a man-made disaster (e.g., a civil disturbance) that adversely affects a geographical area encompassing properties that secure Freddie Mac Mortgages or Borrowers’ places of employment. (b) Property protection activities following a disaster In conjunction with the requirements outlined in Section 8404.1(d), the Servicer is required to protect the Mortgaged Premises by following the requirements outlined in this section. In the event of a disaster impacting Mortgages serviced for Freddie Mac, a Servicer must: ■ Ascertain the number of such Mortgages and the extent of the damage that may have been caused by the disaster for each Mortgaged Premises, which may be completed by:
Freddie Mac Guide 8404.1
404-2 ❑ Determining the status of the property through discussions with the Borrower; and/or ❑ Completing a property inspection per requirements outlined in Section 9202.3(c). Servicers are reminded that property inspections will be reimbursed based on the limits set forth in Section 9701.2(d). Property inspections that are completed outside of the requirements set forth in Section 9701.2(d) may not receive reimbursement. ■ Secure an Abandoned Property (as defined in Section 8403.1) if the Mortgaged Premises has not sustained significant or total damage ■ Provide assistance to the Borrower regarding options for local, State or federal disaster assistance ■ Monitor and coordinate the insurance claim process and the progress of repairs in accordance with Section 8202.5 ■ In addition to the requirements of Section 8202.5, comply with the insurance claim process requirements in accordance with Section 8404.1(c) for Eligible Disasters If a Servicer determines that the disaster has affected a Mortgaged Premises and it may pose a Risk of Property Ownership (see Section 9202.2(b)), the Servicer must notify Freddie Mac within five Business Days of learning of the situation. In such instances, the Servicer must attach copies of the most recent six consecutive months (or less, depending on the level of Delinquency) of Form 1013, 1-4 Unit Property Inspection Report, and any other relevant information when reporting the Risk of Property Ownership to Freddie Mac. Note: Refer to Section 8403.1(a) and 8403.1(b) for additional requirements on properties that become distressed. (c) Insurance loss settlements after an Eligible Disaster If the Mortgaged Premises has been damaged and is located in an Eligible Disaster Area, property insurance proceeds for structural losses must be disbursed in accordance with the insurance loss settlements requirements in Section 8202.5. (d) Delinquency management activities following a disaster In the event a disaster strikes, it is imperative that Servicers be considerate of the Borrower’s circumstances and work to obtain quality right party contact (QRPC) with the Borrower as soon as possible. This section will outline specific activities that a Servicer must take to appropriately manage the Borrower’s Delinquency if the Servicer believes the disaster resulted in a hardship for the Borrower and the disaster is an Eligible Disaster. (i) Circumstances where QRPC has not been achieved
Freddie Mac Guide 8404.1
404-3 If the Servicer has not yet achieved QRPC, then the Servicer, at its discretion, may place a Borrower who becomes 31 or more days delinquent due to an Eligible Disaster in a forbearance plan for up to 90 days, in accordance with the requirements in this section, the transition following disaster-related forbearance requirements in Section 8404.1(f) and the forbearance-related requirements in Sections 9203.3(a) through 9203.3(f). If a Borrower is 31 days or more delinquent at the time of impact due to an Eligible Disaster, the Servicer must achieve QRPC before approving forbearance. The forbearance plan must not exceed 90 days without either achieving QRPC or receiving approval from Freddie Mac (see Directory 5). If the Servicer has relevant information regarding the Borrower’s current financial circumstances and/or the extent of the property damage caused by the Eligible Disaster, the Servicer should consider these factors in its evaluation decision whether to provide forbearance. If QRPC has not been achieved by the end of the forbearance period, then the Servicer must comply with the requirements of Section 8404.1(f)(ii), which provide the transition requirements when QRPC has not been achieved. (ii) Circumstances where QRPC has been achieved If the Borrower does not require any form of relief and there is no Risk of Property Ownership (see Section 9202.2(b)) to Freddie Mac as a result of damage caused by the disaster, Servicers should continue to service the Mortgage in accordance with the requirements of the Guide. If the Borrower requires a relief option or the Mortgaged Premises has damage that would pose a Risk of Property Ownership to Freddie Mac, Servicers have discretion to suspend collection and foreclosure proceedings by placing the Borrower into a forbearance plan, based on the circumstances of each case. The Servicer is not required to obtain a complete Borrower Response Package from the Borrower and may offer: ■ Forbearance for a period of one to three months, and ■ If necessary, one or more successive forbearance plan periods of one to three months and which collectively may not exceed 12 months Without prior approval from Freddie Mac, the forbearance plan may not be extended beyond a date that would cause the Delinquency to exceed a cumulative total of 12 months of the Borrower’s contractual monthly Mortgage payment, including taxes and insurance if the Servicer is collecting Escrow for those expenses. When applicable, such a suspension of Servicing action must be pre-approved by the MI, FHA, RHS or VA to avoid jeopardizing benefits of any applicable insurance or guaranty.
Freddie Mac Guide 8404.1
404-4 Servicers should reassess each impacted Borrower on a regular basis during the forbearance period to determine if forbearance should be extended up to a total of 12 months or the hardship has been resolved. If the Servicer believes forbearance beyond a total of 12 months or beyond a total that would cause the Borrower to exceed 12 months of delinquency is warranted, the Servicer must make that recommendation to Freddie Mac for consideration by submitting a Forbearance Extension Request in Resolve®. In the event Freddie Mac participated in evaluating a Borrower for forbearance beyond a total of 12 months and Freddie Mac denied the request, the Servicer must refer to Section 1301.2(i) for more information on adverse action notices that must be provided to the Borrower on behalf of Freddie Mac under certain limited circumstances. At the end of the forbearance period, the Servicer must reassess the Borrower’s circumstances to determine whether the Borrower’s hardship resulting from the Eligible Disaster has been resolved. The determination may be based on information from the Borrower as a result of QRPC and/or: ■ An updated property inspection assessment of the extent of property damage ■ Discussions with the Borrower If the hardship has been resolved and the Borrower is ready to transition to a permanent solution, the Servicer must evaluate the Borrower for the most appropriate workout option to cure the Delinquency in accordance with the requirements in Section 8404.1(f). If the hardship has not been resolved, then the Servicer must evaluate the Borrower’s eligibility for extended forbearance. (iii) Mortgage eligibility and forbearance plan requirements Except as otherwise provided in this section, when offering forbearance relief to Borrowers impacted by an Eligible Disaster, Servicers must use the requirements set forth in Chapter 9203. The Mortgage may be secured by the following property types: ■ Primary Residence ■ Second home, or ■ Investment Property The property may be vacant or condemned but not abandoned.
Freddie Mac Guide 8404.1
404-5 In situations where the Borrower is unable to send or receive documentation, the Servicer may waive the requirement that the forbearance plan be in writing. In these circumstances, the Servicer may enter the Borrower into a forbearance plan through a verbal agreement. (iv) Other Delinquency management activities The Servicer must not assess late charges as long as the Borrower is on a forbearance plan or paying as agreed on a repayment plan. (e) Disaster reporting requirements (i) Credit reporting for Borrowers impacted by an Eligible Disaster Servicers must report Borrowers who are on a disaster-related forbearance plan, repayment plan or Trial Period Plan to the credit bureaus in accordance with applicable law, including the Fair Credit Reporting Act. (ii) Reporting loans affected by a disaster to Freddie Mac Servicers must report all Mortgages that are affected by a disaster and are 31 or more days delinquent to Freddie Mac via an EDR transmission within the first three Business Days of the month following the month the Servicer learned of the disaster using default reason code 034 (Eligible Disaster Area). (iii) Reporting forbearance or repayment plans to Freddie Mac A Servicer must report all Mortgages that are subject to a repayment plan or a forbearance plan resulting from disaster-caused hardship via an EDR transmission using default code 09 for forbearance or default code 12 for a repayment plan within the first three Business Days of the month following the month that the plan was entered into. The Servicer must continue to report that the Mortgage is under the plan until the Mortgage is fully reinstated or the plan ends. Note: Refer to Chapter 9203 for more details. (f) Transition following disaster-related forbearance If the Borrower was placed on forbearance as a result of an Eligible Disaster, the Servicer must contact the Borrower on a periodic basis and prior to the end of the forbearance period to determine whether the hardship has been resolved and the most appropriate relief or workout option to cure the Delinquency. The Servicer must consider a number of factors, including, but not limited to: ■ The Servicer’s ability to achieve QRPC
Freddie Mac Guide 8404.1
404-6 ■ The Borrower’s current financial circumstances and ability to resume making monthly payments, and ■ The status of the Mortgage at the time of the disaster If, at the end of the disaster-related forbearance period, the Servicer is evaluating the Borrower for a foreclosure prevention alternative based on a Borrower Response Package, the documentation cannot be more than 180 days old as of the date of the evaluation for the foreclosure prevention alternative. (i) Evaluation hierarchy If QRPC is established with a Borrower who was current or less than 60 days delinquent (i.e., less than two months delinquent) as of the date the Eligible Disaster occurred, and the Borrower is unable to resolve the Delinquency through a reinstatement or repayment plan, the Servicer must evaluate the Borrower for the loss mitigation options in the following Disaster evaluation hierarchy: 1. Disaster Payment Deferral 2. Freddie Mac Flex Modification® 3. Standard Short Sale 4. Standard Deed-in-Lieu of Foreclosure If the Borrower was not current or less than 60 days delinquent (i.e., less than two months delinquent) as of the date of the Eligible Disaster, the Servicer must conduct all loss mitigation evaluations in accordance with the standard loss mitigation evaluation hierarchy, as described in Section 9201.2, or must submit an exception request. Note: In most cases, Borrowers impacted by an Eligible Disaster who qualify to be evaluated for a Disaster Payment Deferral will be transitioning from a forbearance plan, but forbearance is not a prerequisite. (ii) Solicitation for a Disaster Payment Deferral The Servicer must proactively solicit the Borrower for a Disaster Payment Deferral in accordance with the requirements in Section 9203.4(i)(v) within 15 days after the expiration of the disaster-related forbearance plan if: ■ The Servicer is not able to establish QRPC during the disaster related forbearance plan, and ■ The Mortgage was current or less than 60 days delinquent (i.e., less than two months delinquent) as of the date the Eligible Disaster occurred, and
Freddie Mac Guide 8404.1
404-7 ■ The Mortgage meets all requirements described in Section 9203.4(i)(vii) Note: Refer to Section 9203.4(i) for complete requirements for the Disaster Payment Deferral. (iii) Solicitation for a Freddie Mac Flex Modification If the Borrower is ineligible for a solicitation for a Disaster Payment Deferral as described above, then the Servicer must evaluate the Borrower for a streamlined offer for a Freddie Mac Flex Modification in accordance with the special Freddie Mac Flex Modification requirements for Borrowers impacted by an Eligible Disaster, as described in Section 9206.1(c)(v). Otherwise, the Servicer must evaluate in accordance with regular Guide requirements for a streamlined offer for a Freddie Mac Flex Modification, as described in Section 9206.1(c)(iii). The Servicer must send a streamlined offer for a Freddie Mac Flex Modification to an eligible Borrower within 15 days of the expiration of the forbearance plan. If the Borrower was eligible for a solicitation for a Disaster Payment Deferral but did not accept the offer, the Servicer must evaluate the Borrower for a streamlined offer for a Freddie Mac Flex Modification following the same requirements as described above except that the Servicer must send the streamlined offer to an eligible Borrower within 15 days of the expiration of the Disaster Payment Deferral offer. Note: Complete requirements for Freddie Mac Flex Modifications for Borrowers impacted by an Eligible Disaster can be found in Sections 9203.4(i) and 9206.1(c)(v). (iv) Transition requirements for Borrowers who were on a Trial Period Plan at the time of the Eligible Disaster If a Borrower who was performing in accordance with the terms of a Trial Period Plan is placed on forbearance as a result of an Eligible Disaster, then within 30 days prior to the end of the forbearance period, the Servicer must determine whether the Borrower’s financial circumstances continue to be adversely impacted by the disaster based on verbal confirmation with the Borrower about his or her current financial condition and an updated assessment of the extent of the property damage resulting from most recent property inspection or the current conditions of the property based on discussions with the Borrower. If the Borrower was performing on a Freddie Mac Flex Modification at the time of the Eligible Disaster, the Servicer must make a new streamlined offer to the Borrower for a Freddie Mac Flex Modification Trial Period Plan meeting the requirements of Section 9206.1(c).
Freddie Mac Guide 8404.1
404-8 Regardless of the Borrower’s financial circumstances, the Borrower must complete a new three-month Trial Period Plan that begins immediately following the forbearance plan in order to be eligible for a permanent modification.
Freddie Mac Guide 8404.1
Servicing Mortgages impacted by a disaster (Future effective date 10/01/26) This section contains information related to: ■ Overview of Servicer responsibilities following a disaster ■ Property protection activities following a disaster ■ Insurance loss settlements after an Eligible Disaster ■ Delinquency management activities following a disaster ■ Disaster reporting requirements ■ Transition following disaster-related forbearance (a) Overview of Servicer responsibilities following a disaster This chapter provides Servicers with our requirements for assisting Borrowers whose Mortgaged Premises or places of employment are located in an Eligible Disaster Area. A disaster may be a natural disaster (e.g., an earthquake, flood or hurricane) or a man-made disaster (e.g., a civil disturbance) that adversely affects a geographical area encompassing properties that secure Freddie Mac Mortgages or Borrowers’ places of employment. (b) Property protection activities following a disaster In conjunction with the requirements outlined in Section 8404.1(d), the Servicer is required to protect the Mortgaged Premises by following the requirements outlined in this section. In the event of a disaster impacting Mortgages serviced for Freddie Mac, a Servicer must: ■ Ascertain the number of such Mortgages and the extent of the damage that may have been caused by the disaster for each Mortgaged Premises, which may be completed by: ❑ Determining the status of the property through discussions with the Borrower; and/or ❑ Completing a property inspection per requirements outlined in Section 9202.3(c). Servicers are reminded that property inspections will be reimbursed based on the
Freddie Mac Guide 8404.1
404-9 limits set forth in Section 9701.2(d). Property inspections that are completed outside of the requirements set forth in Section 9701.2(d) may not receive reimbursement. ■ Secure an Abandoned Property (as defined in Section 8403.1) if the Mortgaged Premises has not sustained significant or total damage ■ Provide assistance to the Borrower regarding options for local, State or federal disaster assistance ■ Monitor and coordinate the insurance claim process and the progress of repairs in accordance with Section 8202.5 ■ In addition to the requirements of Section 8202.5, comply with the insurance claim process requirements in accordance with Section 8404.1(c) for Eligible Disasters If a Servicer determines that the disaster has affected a Mortgaged Premises and it may pose a Risk of Property Ownership (see Section 9202.2(b)), the Servicer must notify Freddie Mac within five Business Days of learning of the situation. In such instances, the Servicer must attach copies of the most recent six consecutive months (or less, depending on the level of Delinquency) of Form 1013, 1-4 Unit Property Inspection Report, and any other relevant information when reporting the Risk of Property Ownership to Freddie Mac. Note: Refer to Section 8403.1(a) and 8403.1(b) for additional requirements on properties that become distressed. (c) Insurance loss settlements after an Eligible Disaster If the Mortgaged Premises has been damaged and is located in an Eligible Disaster Area, property insurance proceeds for structural losses must be disbursed in accordance with the insurance loss settlements requirements in Section 8202.5. (d) Delinquency management activities following a disaster In the event a disaster strikes, it is imperative that Servicers be considerate of the Borrower’s circumstances and work to obtain quality right party contact (QRPC) with the Borrower as soon as possible. This section will outline specific activities that a Servicer must take to appropriately manage the Borrower’s Delinquency if the Servicer believes the disaster resulted in a hardship for the Borrower and the disaster is an Eligible Disaster. (i) Circumstances where QRPC has not been achieved If the Servicer has not yet achieved QRPC, then the Servicer, at its discretion, may place a Borrower who becomes 31 or more days delinquent due to an Eligible Disaster in a forbearance plan for up to 90 days, in accordance with the requirements in this section, the transition following disaster-related forbearance requirements in Section 8404.1(f) and the forbearance-related requirements in Sections 9203.3(a) through 9203.3(f).