Fannie Mae Strikes Deal with Neighborhood Assistance to Stem F...
As the tide of foreclosure continues to wreak havoc to the housing industry, mortgage giant Fannie Mae has decided to bury the hatchet and work with one of its most vocal critics — Neighborhood Assistance Corp of America.
The agreement reached by these two actually revolves on stopping foreclosure. Just recently, Fannie Mae made an announcement that it will be streamlining its loan modification procedures. In addition, it has also suspended foreclosure evictions and sales until February 1.
These efforts clearly show how the mortgage company is working overtime to ensure that the foreclosure crisis does not worsen. Amidst the pressure from government officials, lenders and regulators to promote loan modification, Fannie Mae has pushed home prices down even further.
On the other hand, the non-profit organization NACA is pressuring banks to cooperate and ensure that all mortgages provided contain fair loan terms. Last October, the group protested outside the Washington headquarters of Fannie Mae to demand the mortgage giant to support their foreclosure-prevention efforts by making sure that banks engage in more loan modification work-outs.
NACA is already acting as mediator between lenders and borrowers and have worked with companies like Wells Fargo and Bank of America. Its main objective is to provide assistance to distressed homeowners by making sure that a loan modification is considered to stop the foreclosure. They usually start with finding out how much in monthly mortgage payments they could afford and then work with the lender so that either the interest or the principal is reduced.
After this agreement with Fannie Mae, NACA will be targeting its brother Freddie Mac since it guarantees or owns almost half of the nation’s home mortgages. Similarly, they will suggest for the workout of these delinquent mortgages.
Before finalizing the agreement, both Fannie and Freddie will require the approval of the Federal Housing Finance Agency, their regulator.
By Cassiano Travareli