Freddie Mac Single-Family Seller/Servicer Guide 9211.1 — Mortgage assistance funds

This section highlights the requirements relating to mortgage assistance administered by State and local governments along with other third-party organizations. The following information is related to: ■ General requirements for mortgage assistance funds ■ Borrower authorization requirements ■ Mortgages with credit enhancements ■ Another relief or workout arrangement ■ Foreclosure actions ■ Reporting to Freddie Mac

(a) General requirements for mortgage assistance funds The facilitating organization determines Borrower eligibility criteria and underwrites the Borrower. Unless permitted by the organization, Servicers may not determine Borrower eligibility or communicate a determination of eligibility or qualification for mortgage assistance to a Borrower. Servicers must accept such mortgage assistance funds on behalf of a Borrower as though they were from the Borrower and apply the funds in accordance with the Security Instrument, the Guide and applicable law. Should the funds received be insufficient to bring the Mortgage current, refer to the sections below on partial reinstatements: Additional reinstatement requirements Topic Guide location Types of reinstatement Section 9203.1(c) When to accept full reinstatement Section 9203.1(d) When to accept partial reinstatement of a Mortgage in foreclosure Section 9203.1(e) Additional reinstatement requirements Topic Guide location Reporting and processing the reinstatement Section 9203.1(f) Reimbursement of expenses related to reinstatements Section 9203.1(g) If payment represents only a partial payment, the Servicer must not waive rights under the Mortgage to collect the unpaid amount and must continue collection efforts and attempt to establish quality right party contact as outlined in Chapters 9101 and 9102. Note: For Borrowers where mortgage assistance funds result in a partial prepayment, refer to Sections 8103.3(d) and 8303.2(a)(iii).

(b) Borrower authorization requirements In connection with a Borrower’s request for mortgage assistance, Servicers must receive authorization from each Borrower to release his or her nonpublic personal financial information to an authorized mortgage assistance organization. The Borrower’s authorization to release his or her nonpublic personal financial information to the mortgage assistance organization and all communications that include a Borrower’s nonpublic personal information must comply with Section 1301.2 and all applicable laws.

(c) Mortgages with credit enhancements Servicers must comply with the requirements of, and obtain approvals as necessary from the FHA, VA, RHS and/or MI. Credit enhancement on a Mortgage must stay in place regardless of the Borrower’s participation in a mortgage assistance program.

(d) Another relief or workout arrangement Servicers must not deny or delay consideration of a Borrower for a relief or workout option pending approval for mortgage assistance. If a Borrower is currently performing under a relief or workout arrangement that has not been completed and the Borrower requests assistance from a mortgage assistance program, the Servicer must permit the Borrower to continue with the relief or workout arrangement. As noted in Section 9212.1(a), any funds received from the mortgage assistance program should be treated as funds from the Borrower and applied in accordance with the Security Instrument, the Guide and applicable law. Servicers should refer to Chapters 9203 through 9210 for relief and workout options guidance accordingly. For streamlined evaluations for a Freddie Mac Flex Modification®, the Servicer must refer to guidance provided in Section 9206.1(c)(iii) in the event the Mortgage is reinstated, but in no instance must any Freddie Mac Flex Modification Trial Period Plan already evaluated for an offered be revoked as a result of reinstatement. The Servicer must cancel an active forbearance plan, an active repayment plan or a payment deferral that has not yet been completed if the Mortgage is fully reinstated as a result of mortgage assistance funds. If the Borrower requests additional assistance following reinstatement, the Servicer must evaluate the Borrower for relief and workout options in accordance with the evaluation hierarchy in Section 9201.2 and with the requirements for the specific relief and workout options. Refer to the following Guide sections for details on additional workout options: Additional workout options Topic Guide location Reinstatements and relief options Freddie Mac workout options Home Affordable Modification ProgramSM Modifications Workout Mortgage assumption Freddie Mac Standard Short Sale Freddie Mac Standard Deed-in-Lieu of Foreclosure Charge-off

(e) Foreclosure actions Servicers may postpone foreclosure activity in accordance with the Guide and applicable law for up to 45 days if they have been notified that the Borrower is participating in a mortgage assistance program and they have a good faith belief that the participation with the program will cure the Borrower’s Delinquency. The Servicer may extend the suspension of foreclosure actions beyond 45 days, as necessary, to facilitate the processing of the mortgage assistance, provided that: ■ It continues to validate with the mortgage assistance provider that the Borrower’s status has not changed ■ The action is in compliance with its agreement with the mortgage assistance provider; and ■ It obtains Freddie Mac’s prior approval for any suspension beyond 60 days Servicers must submit approval requests for foreclosure activity suspension beyond 60 days to [email protected]. Servicers should refer to appropriate Guide sections on preforeclosure activities, including Sections 9301.2(a) and 9301.7(b). Servicers must note the reason for the postponement in the Mortgage file (e.g., third-party mortgage assistance). In the event a foreclosure sale occurs, the Servicer’s performance will be measured against Freddie Mac’s State foreclosure timelines (refer to Exhibit 83, Freddie Mac State Foreclosure Timelines). Servicers are reminded that if they postpone foreclosure activity, they can resume foreclosure activity without delay if the mortgage assistance program and/or any loss mitigation solution is unable to resolve the Borrower’s Delinquency. Servicers are further reminded that when communicating a postponement request for a pending foreclosure sale to foreclosure counsel, the Servicer must identify the reason for the postponement (i.e., third-party mortgage assistance). If a notice of trustee/sheriff sale has been recorded and the trustee/sheriff sale is scheduled less than seven days from the date the Servicer is notified of Borrower approval for mortgage assistance, the Servicer is not required to accept the mortgage assistance payment. The Servicer should refer to Section 9301.7(b)(ii), the terms of the Note and applicable law accordingly for further guidance.

(f) Reporting to Freddie Mac The Servicer must be able to readily identify any Borrower who receives third-party mortgage assistance funds from any State or local governmental agency, such as a housing finance agency or its designee. The Servicer must be able to provide this information to Freddie Mac upon request.