On Wednesday, December 14, Fannie Mae and Freddie Mac announced their new Flex modification program. This program will replace the government’s HAMP program which was introduced nine years ago, to save struggling families who were facing mortgage crisis and were in danger of default.
The Home Affordable Modification Program is slated to end on December 31, 2016, after which the Flex modification prevention program will come into effect. The Flex foreclosure prevention program is carefully designed to protect American families by offering homeowner’s a reduction of their monthly mortgage payments.
The Federal Housing Finance Agency said, “The Flex modification program was designed keeping in view the flaws and lessons learned from HAMP programs, helping homeowners to avoid foreclosures.”
The statement adds, “The Flex program will also reflect the input received over the mortgage engagement with lenders, insurers, and other stakeholders. By avoiding the foreclosures associated high-cost the new program will also result in huge savings for taxpayers.
FHFA further added, “Those borrowers who face permanent hardships in releasing their mortgage payments will continue to be assisted by the new Flex modification program.”
Fannie Mae: The Vice President of Single-Family Servicing Policy, Bill Cleary said, “The process will further be simplified to deliver those solutions. We believe in the flexibility of the Flex modification program to adjust local and regional differences in the housing market. For those who’re in greatest need of support, the program will continue to assist them in this changing housing environment.”
The Flex modification will replace the Fannie Mae current streamlined and standard offerings on and after October 1, 2017. However, until then the services of evaluating borrowers must be continued.
The executive vice president, David Lowman, Freddie Mac’s Single-Family Business said, “We are proud to design and introduce the Flex Modification program, which laid out five factors, such as, transparency, affordability, sustainability, accessibility, and accountability. It is the perfect balance between economic responsibility and struggling homeowners relief.”
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